The Socceroos were 1-0 by Japan in extra-time after Tadanari Lee's spectacular 109th-minute volley.

But Australia had their chances earlier in the contest, with Harry Kewell's second-half one-on-one with Eiji Kawashima arguably the best chance.

"We had our opportunities and what is always encouraging is the way we play and we create opportunities," Osieck said.

"However, it is crucial to convert them and later on in the game it backfired and that is a problem.

"We had to be more clinical in our finishing and it's not enough to win a game if you don't score.

"We have seen a very exciting game between two very good teams. You can imagine we are disappointed, we definitely had our opportunities but unfortunately we couldn't convert."

He added: "I'm very proud of my players, their performance and their attitude. I give them credit and really feel sorry for the boys that they didn't get the reward for their efforts.

"You can imagine in our dressing room it's not a great atmosphere, everybody's really sad.

"All in all, our team represented Australia in a great way."

Skipper Lucas Neill said: "Mixed feelings, proud, disappointed.

"We always felt in control of the game even though we gave away a lot of possession to Japan it never felt they were really going to hurt us.

"In our defence we felt solid and strong and then one lapse in concentration and maybe a moment of fatigue in extra time, it's gifted them the goal."