Wenger's men started the week as title contenders but they have faltered in a 6-0 thrashing at league leaders Chelsea in his 1,000th game in charge on Saturday and a disappointing draw with Swansea after a last-minute Mathieu Flamini own goal.
"Winning the title isn't the biggest worry we have at the moment," Wenger said.
"We have to be realistic. We must look behind us. Everton won and, of course, now we have to focus and play the next game (at home to Manchester City).
"Manchester City had a good result tonight (a 3-0 win at Manchester United). They look a bit unstoppable. Them and Chelsea are the favourites now for the title. We don't have too much room to come back into it."
Chelsea have 69 points from 31 games ahead of City on 66 from 29, with Liverpool in third on 65 from 30, Arsenal are fourth with 63 from 31 while Everton have 57 from 30.
Arsenal's Champions League qualification spot looks all the more precarious with Manchester City coming to The Emirates on Saturday before Wenger's side visit Everton on April 6.
Wenger had hoped for an instant response to the miserable Chelsea result but Swansea took an unlikely lead after 11 minutes when Neil Taylor crossed from deep and Wilfred Bony out-jumped the defence to plant a header just inside the near post.
Arsenal dominated possession as the visitors protected their lead but the nerves from the crowd permeated into the players, and the home side failed to turn domination into chances.
Lucas Podolski's introduction after the break signalled a greater attacking intent by the hosts and in the 73rd minute he converted a Kieran Gibbs pull back before setting up Olivier Giroud to score a minute later with a cross from the left.
But Wenger's disastrous week was summed up when his defence allowed Leon Britton to surge into the box in the last minute.
Arsenal central defender Per Mertesacker stretched to stop the Swansea player but his tackle only deflected the ball against diving foalkeeper Wojciech Szczesny, with the rebound hitting Flamini and trickling over the line.
"The result is very disappointing," said Wenger. "At 2-1 we were maybe too conservative because our confidence level had been affected by Saturday and we just wanted to win the game without pushing any more forward.
"A mistake happened and it created the result we didn't want tonight."
Wenger's miserable week could have been worse as Jonathan de Guzman ran clear on Arsenal's goal in the fourth minute of added time only for the referee to blow his whistle to end the game.
Swansea manager Garry Monk was baffled by the decision and believed his side were unjustly denied a chance for a vital win as they fight to avoid getting dragged into a relegation battle.
"It was a poor decision," Monk said "They told us it was going to be four minutes at the end of the game, we scored in that period so they added an extra minute on the clock. So it's five minutes minimum, we're clean through on goal and they blow up 30 seconds short.
"It would have definitely been a shot on goal. It's going to be a goalscoring opportunity for sure.
"In all the games I've ever played in I've never had the whistle blown in those circumstances."
Swansea are 15th but only five points above the drop zone, having played three games more than Sunderland who are in 18th position and occupy the last relegation place.
They host fellow strugglers Norwich City on Saturday knowing a win is vital to help secure Premier League safety.
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