The game was only given the go-ahead an hour and a half before kick-off after torrential rain left the field muddy and Houllier's men were unable to adapt to the conditions.
"We were surprised by the pitch conditions and the high tempo. They were better than us and deserved to win."
"The lads know that they were outclassed physically and could have done better. The average age is 23 and some were new to this game. It was a very commited game, but they will learn and they will adapt."
Liverpool's recent poor results have left them in seventh place in the table, 12 points behind the Gunners.
After the game at Highbury on Sunday Houllier had declared the title race on, but was more realistic when asked again.
"We have the ability but I think it will be difficult to catch up with Arsenal - 12 points is a lot - but you never know what can happen in football."
