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To reduce the file size in Premiere Pro, click on the export button and set the file location and name. Change the format to h265 for higher quality in the same size. Make sure the presets are set to custom, then click on Match source for correct settings. Enable two boxes in the more button menu, set performance to high, and choose vbr1 pass for bitrate encoding to reduce file size while maintaining quality. Adjust the bitrate to decrease file size, with lower values resulting in smaller estimated file sizes.