Arsenal 2 Olympiakos 3

Arsenal are on the brink. For the last 15 seasons their participation at the Champions League knock-out phase has felt set in stone. Not this time. The cracks were as plain as the dismal defending and their astonishing naivety, and it would now represent a surprise if Arsene Wenger and his players could wriggle out of Group F.

After the defeat at Dinamo Zagreb and with Bayern Munich due up next – home and then away – the prognosis looks bleak. One thing is clear: they will get nothing and deserve even less if they play with the same lack of backbone as they did here against Olympiakos.

They were undermined by a familiar cocktail – a bit of bad luck, set-piece concessions, barely conceivable individual errors and, to seal the result, a lunge towards the self-destruct button.

It was difficult not to paint David Ospina as the villain-in-chief. Preferred to Petr Cech, the goalkeeper failed to instil any confidence and had his own shattered by the blunder towards the end of the first half when he dropped Kostas Fortounis's corner into his own net.

Arsenal pressed onto the front foot, led by Alexis Sanchez, but, after he had equalised for 2-2 in the 66th minute, his defensive team-mates went awol to allow Olympiakos back in front and, this time, they did not look back. Wenger had described this as a must-win tie. Arsenal's gloom was palpable.

Wenger had acknowledged Arsenal's poor recent home record in the Champions League and he blamed visiting teams for the dastardly tactic of putting men between the ball and their goal. This is, of course, not how football should be played. Olympiakos lined up with the 35-year-old Esteban Cambiasso in front of their back four and behind four other midfielders and yet they were not the archetypal deniers of space.

Sanchez enjoyed room at the outset and he ran hard at the visitors, which normally prompts anxiety, and there was the faintly surreal sight of him leading a five-on-three break as early as the 10th minute, after Arsenal had cleared an Olympiakos corner. Sanchez advanced and ushered in Alex Oxlade-Chamberlain who, under pressure from Leandro Salino, shot into the side netting.

Olympiakos committed men forward themselves and there were nervous moments in the Arsenal defence, aside from the goals, including a portent of what was to come when Ospina, curiously, stayed on his line following a 12th-minute free-kick, which Kostas Fortounis whipped in. Happily for him, a flag went up for an offside in the middle.

There was also the mix-up between Laurent Koscielny and Gabriel, when the latter crashed into his partner in an attempt to win a header and, when Brown Ideye worked the ball back to Fortounis, the midfielder's shot was deflected over for a corner.

From it Olympiakos forged ahead. Cambiasso's delivery was angled back to the edge of the area, from where Felipe Pardo struck first-time, the ball deflecting off Oxlade-Chamberlain to fizz past Ospina.

Arsenal response was positive and immediate. The relentless Sanchez tricked past two blue shirts and he weighted a pass forward for Theo Walcott, who had timed his run beyond the visitors' backline. He opened up his body to curl for the far corner and he was helped when Roberto, the Olympiakos goalkeeper, made a hash of things and allowed the ball to slip underneath him.

It was Ospina, though, who dropped the most nightmarish of clangers and it shone an extremely harsh light on Wenger’s decision to persist with him, at the expense of Cech, in the Champions League. There was some muttering about Cech having a slightly tight calf but, make no mistake, his absence was down to selection and not injury.

Fortounis’s corner from the left was whipped in and it also caught the breeze back towards Ospina’s goal. The goalkeeper jumped and he appeared set for a routine take only to drop the ball and, almost in slow motion, watch it fall over the line. His desperate attempts to salvage the situation were for naught, as the goal-line assistant saw daylight between the ball and the line.

Wenger sent his players out early for the second half and when Olympiakos emerged they were confronted by the home team, lined up in formation. The Arsenal manager is not a half-time ranter but it had not been difficult to imagine the thrust of his address: the club were playing for their Champions League lives, and needed to play as though they meant it.

Sanchez had grown visibly frustrated towards the end of the first half and was booked for dissent when a corner decision went against him. His movement, though, was sharp – far sharper than his team-mates’ – and he looked like being the best bet to drag Arsenal back into it.

Wenger lost Koscielny to a muscle pull and so grave was the situation, he replaced Francis Coquelin with Aaron Ramsey on 56 minutes; he often waits until the 70th minute to make unenforced changes. Arsenal cranked up the pressure. Roberto denied the substitute, Per Mertesacker, and, from the rebound, Omar Elabdellaoui headed Santi Cazorla's blast off the line. Roberto, who punched clear another Cazorla blast, was booked for time-wasting in the 64th minute.

It was Sanchez who restored parity, tearing into space in the middle to head Walcott's cross from the right into the bottom corner, but it was merely the prompt for Arsenal to self-combust. Almost implausibly, their defensive structure broke down and only Mertesacker's lunging block denied Fortounis. But Olympiakos kept the ball and when Cambiasso played Pardo into space on the right, his cross was touched home deftly by the substitute, Alfred Finnbogason.

Arsenal felt deflation. They attempted to rouse themselves, Mesut Özil going closest to another equaliser, but the damage had been done. (Guardian service)