However, Ulster scored within minutes of the restart courtesy of a fine break from Darren Cave and the Ospreys failed to swing the game back their way.
And while Tandy was encouraged by his young side's display, seeing Ulster leapfrog them in the table was tough to take.
"There was a lot to be delighted about in that performance but the ultimate feeling is one of disappointment," Tandy told the Ospreys website.
"We were very good in a lot of what we did, and I'd say that we probably deserved the win on reflection, but immaturity around our exits in the second half allowed Ulster to keep us boxed in at times. We didn't execute what we've been practicing at crucial times.
"We need to be more ruthless when we are away at places like Ravenhill, against a team that are one of the best in Europe.
"To be going home disappointed after picking up a bonus point when you look at the difference in resources available to the two sides says a lot about this group of players and about how well they did but, it's a disappointed dressing room."