O'Neill installed Lafferty as his first-choice centre forward when he took over from Nigel Worthington at the start of last year, but has not been impressed by the Palermo player's output.
In five qualifiers he has managed no goals, two yellow cards, one sending-off, a couple of injuries and countless offsides.
His dismissal against Portugal last week means he did not travel with O'Neill's squad for Tuesday's clash in Luxembourg and an expected three-game ban would mean his campaign is over.
If that is the case, he can consider it an unmitigated failure judging by his manager's verdict.
"The reality is that he misses this game suspended and I'd say he'll miss the next two as well, that wouldn't surprise me," said O'Neill.
"We will address it after that. I had a good conversation with Kyle and he was very apologetic and recognises he has let his team-mates down.
"I would never say I would wash my hands of him or anything like that because he is still a player who can potentially be a big asset to the squad.
"But at this minute in time he is not giving us very much and he knows that.
"After quite a good start to the campaign he has contributed very little and he knows he won't have contributed very much in the second half of the campaign.