Elsewhere, crosstown rivals Melbourne Victory drew 1-1 with second-placed Wellington at the Home of the Matildas.
City (30 points) lead Wellington (25), Canberra (24), Adelaide United (23), the Victory (22) and Central Coast (22).
"Picking up these points can really matter when you get late in the season," Phoenix coach Bev Priestman told AAP of the table squeeze.
"So yes, I'm happy to be at second now, but we know this table is very, very tight, and it will be probably to the death."
In Gosford, City took the lead when Holly McNamara, fresh off being named in the Matildas' Asian Cup squad, cleverly squared the ball for Bryleeh Henry to score.
City doubled their lead in the 68th minute when central defender Taylor Otto showed her attacking prowess, playing a one-two with Aideen Keane then cutting back for fellow centre-back Rebekah Stott to finish first time.
The City skipper, a rare goal scorer, wheeled away in delight.
Six minutes later, the visitors sealed three points when Henry found Keane, who beat a defender and rifled home.
Mariners star Izzy Gomez headed home at the near post in the 77th minute to keep things interesting but City held on.
In Bundoora, the Victory weathered an early storm from Wellington, with goalkeeper Courtney Newbon making a huge one-on-one stop to deny Brooke Nunn just before halftime.
The Victory took the lead after Grace Jale brought down Sofia Sakalis in the area and Rhianna Pollicina rifled home the penalty in the 52nd minute.
Alana Jancevski skidded a shot into the side netting in the 83rd, while Kennedy White should have made it 2-0 a minute later but shot straight at Victoria Esson.
Wellington equalised in the 88th minute when young gun Pia Vlok slipped through Makala Woods to score, with Victory's appeals for offside falling on deaf ears.
"We needed the result today but it didn't happen. Everything else, apart from one or two small things, really happy with them," Victory coach Jeff Hopkins told AAP.
"I can't fault the effort, the determination, the hard work, the will to win. It's all there.
"If we can get ourselves into the finals still in this form, we're good enough to beat anyone."