City slumped to a 1-0 defeat by Swansea City at the Liberty Stadium last Sunday, handing Sir Alex Ferguson’s side the advantage in the title race.
“We need to play well in every game because there are not many left now,” Hart told City’s website.
“We’re one point behind the leaders of the Premier League, we’re a good team and we’ve got nothing to worry about.
“We’ll go into the game against Chelsea as favourites – and we should be favourites.”
The 24-year-old has been one of City’s most consistent performers this season, but the former Shrewsbury Town goalkeeper insisted he can still up his game.
“I can definitely improve,” he added. “I like to think I’m improving in all sorts of areas.
“All keepers are going to have good patches and bad patches and at the moment I seem to be in a good one – but I know that can change. You need to be mentally strong, more than anything.”
Hart described City team-mate Mario Balotelli as one of the world’s best penalty takers after the Italian striker scored from the spot in the 3-2 victory over Lisbon on Thursday.
But the England international is confident he would come out on top should the pair meet at Euro 2012.
“Yeah, I hate to say it, he’s one of the best I’ve ever faced,” said Hart.
“He’s got this mad ability where he doesn’t need to look at the ball. If you don’t move he kicks it in the corner; if you do move he kicks it the other way – it’s almost impossible to stop.
“I need to get inside his head and I reckon if England played Italy, I would be able to stop him!”
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