City's season is now in danger of fizzling out after Barcelona ended their hopes of progressing in Europe with a formidable display in the Nou Camp.
City were overrun by the Catalan giants, losing 1-0 for a 3-1 aggregate loss that could easily have been much heavier but for Joe Hart's heroics.
Coming four days after a shock loss to Burnley left their Barclays Premier League title defence in tatters, City look set to end the season empty-handed and reflecting on under-achievement.
But Pellegrini insists the campaign is not yet over, and wants a strong response against West Brom on Saturday.
The Chilean, who is looking increasingly vulnerable in his position, said: "We are second in league, need to consolidate our position and see where we are over (the last) nine games.
"We must never give up
We are six points behind Chelsea, so it is difficult, but we still have nine games left
We must focus our minds.
"It is a disappointment not to go through but we have just played the best team in the world."
City's progress this season - or lack of it - will be assessed by the club's hierarchy at the end of the campaign and Pellegrini believes there will be positives to look back on.
He said: "It is not the correct moment to analyse what we should do next season.
"But we have improved in the Champions League
If we played against another team, maybe we could be in the last eight."
Pellegrini was heavily criticised for his tactics in the first leg, which City lost 2-1
He varied his approach at the Nou Camp, playing with Sergio Aguero as a lone striker but to no avail.
But with Barca in such imperious form - Hart made a series of stunning saves while they hit the woodwork three times - there was perhaps little the Chilean could have done to affect the outcome.
"I always feel responsible for my team," he said
"I pick the players and the way we play
The performance has a lot to do with the tactics, but I would do exactly the same again."
City's defeat meant that all four of the Premier League's representatives in the Champions League this season have gone out before the quarter-finals.
In his post-match press conference, Pellegrini again highlighted England's heavy fixture schedule in December and January as one potential reason
City also received tough draws in the competition yet again, while they were restricted in terms of squad size and spending after being found guilty of breaching Financial Fair Play regulations.
But Hart, who left the Nou Camp with his head held high after one of the best performances of his career, was not interested in possible excuses.
"I wouldn't say they were hard draws, every one of us have gone into every game with a fair chance of winning," he said of the English clubs' failure.
"I wouldn't dare talk for anyone else, I just talk for City and we weren't good enough over two legs."
Source : PA
Source: PA