Manuel Pellegrini admitted his decision to play a weakened team against Southampton backfired after Manchester City were easily beaten 4-2 at St Mary's on Sunday.
The City boss made eight changes from the side that drew 0-0 with Real Madrid in the Champions League semifinal first leg last Tuesday, with Sergio Aguero, Kevin De Bruyne and Vincent Kompany among his players rested ahead of the second leg at the Bernabeu on Wednesday.
But his side were second best in a poor performance that leaves City's qualification for next season's Champions League in jeopardy after rivals Manchester United had earlier cut the gap to fourth place to four points with a game in hand.
Pellegrini admitted that he prioritised the Champions League second leg in Spain; particularly as their game against Southampton was on Sunday -- more than 24 hours later than Real Madrid's La Liga fixture at Real Sociedad.
The Chilean said: "I'm very frustrated because I didn't expect that performance -- especially in defence. At least four of them [who started] are not playing [regularly].
"I think we could've played on Saturday and named a stronger team. But in this case we had to prioritise Wednesday's game. The best way to prepare is to win but we couldn't do it.
"I tried to select a team that would win the game. I also had to select a team based on who would play on Wednesday.
"Maybe if we played on Saturday we could have another option for this game but playing with too many players that are not playing often is difficult."
City will still finish third if they win their final two Premier League games -- at home to Arsenal and away to Swansea City -- irrespective of other results.
Pellegrini added: "It's exactly the same, it all depends on what we can do in these last two games. We are three points behind Arsenal and if we beat Arsenal we'll be in third position before the last game."
Nigerian striker Kelechi Iheanacho scored both of City's goals to follow up from his double in last weekend's 4-0 victory over Stoke City.
The 19-year-old said they must put the result to the back of their mind ahead of their semifinal against Real Madrid.
"Many things went wrong in our team. We lost so many balls and didn't defend well," Iheanacho said.
"I think we're going to come stronger in the next game. This game didn't give us enough encouragement. But we will put it behind us and focus on the Real Madrid game."