Pep Guardiola admits Manchester City are now "far away" from Liverpool but admits his team cannot afford to give up on the Premier League.
City are now 14 points behind the Reds having played a game more after slumping to a 3-2 defeat at Wolverhampton Wanderers on Friday.
Despite having Ederson sent off early on, the champions raced into a 2-0 lead but were beaten by Matt Doherty's 89th-minute winner.
Guardiola has reiterated his belief his team cannot catch Liverpool, but he has vowed City will not throw in the towel in the Premier League.
“We cannot prioritise the cup competitions because if so next season we might not be in Europe," he said.
“We are used to being at the top fighting and now we are far away. We have to adjust mentally to the situation and prepare for the next games.
“I said many times ‘it’s unrealistic to think about Liverpool. We have to think about Leicester’.
"We have a chance to recover second position. We are third and that is the situation.
“We have to move on. The first season was quite similar to now but in the second and third seasons we were there all the time and winning a lot of games.
“Now, because of some mistakes and some other situations, we are far away.”
