After two impressive performances against the All Blacks in New Zealand, a victory was a distinct possibility 10 minutes into the second half when flanker Neil Best's try was converted by Ronan O'Gara to give Ireland a 15-11 lead.
But from that point on it was all one-way traffic, with Australia running in four tries to record an 18-point win and lift the Lansdowne Cup.
"Ten minutes into the second half the next score was crucial and they got lucky on a free kick," O'Sullivan said. "Two sucker punches in four minutes, that did us at the end of the day."
Ireland captain Brian O'Driscoll echoed O'Sullivan's comments.
"We got a little bit more in the legs when we scored just after half-time and then when we got our two sucker punches that really hits home," O'Driscoll said.
"It's difficult to pick yourself up after that, you really start feeling it in your legs and your whole body, it's just the way things go - when you're on top you feel a little bit rejuvenated, as we did twice, and it is like a sucker punch.
"When you're behind the posts it's just trying to make sure you get back and get back into the game, and when they hit us with the second one it really killed us and probably killed the game.
"In that first 10 we got a great try and then I think the legs got really heavy and three weeks of hard Test rugby started to take its toll on the boys."
Although both Sullivan and O'Driscoll were disappointed with the loss to Australia and the preceding defeats by New Zealand the Irish captain was philosophical about where the results of the southern Hemisphere tour leave the team.
"I think all three Test matches have been particularly hard," O'Driscoll added. "We knew they would be and we felt as though we had the opportunity of coming down and taking a scalp, but it obviously shows we've some way to go yet."