O’Neill, who was taking charge of NI for the 100th time as manager, praised his players for “giving everything” but was ultimately left to rue poor defending from a corner that allowed Woltemade to score, albeit fortuitously as the ball bounced off his shoulder and into the net.
Dan Ballard had a goal disallowed in the first half, while Jamie Reid, Ethan Galbraith and Callum Marshal were among players who went close for an NI side that penned Germany back in the last quarter of the game.
“First half, we lacked a little bit of belief with the ball, but we were in the game and weren’t conceding a lot of chances,” he added.
“The goal was a freak goal; it comes off his shoulder. We should have defended it better.
“Second half we were well in it. It’s a game we should have gone ahead in; we have the goal disallowed for offside and we shouldn’t be offside.
“We had a chance or two at the end, Justin [Devenny] doesn’t settle himself to hit it, and Callum makes the goalkeeper make a save. Fatigue a bit at the end, but we couldn’t have asked for anymore and it’s just disappointing to lose the game.”
The defeat leaves Northern Ireland third in Group A, three points behind Germany and Slovakia.
They round off their campaign with an away game against Slovakia and a home match against Luxembourg next month.
O’Neill acknowledged that their trip to Kosice is a must-not-lose game to keep them in contention for finishing second in the group and securing a play-off.
“I haven’t really looked at it, but we will hope four points will be enough next month, but we have to go to Slovakia and make sure we are not beaten so we then have something to play for,” he said.