Jeffers took time out from his spell in the Highbury medical room to win the penalty that earnt Arsenal a point against Liverpool in December. Houllier feels that the Reds season might look a lot healthier if his side had won that particular match.
He said: "That was the day our championship hopes disappeared. It is probably fair to say that incident ended our hopes.
"When you consider the knock-on effect, in terms of confidence as well as points gained, that was when we knew it was all over.
"Jeffers himself admitted to some of our players after the done. It wasn't only two points taken from us, but the psychological effect the incident had on us as well. If we had won at Arsenal, then we would not have performed so badly at Newcastle.