Salah has one year remaining on his existing deal and is reluctant to sign new terms unless he's given a massive pay rise.
The 29-year-old knows what he wants and according to Reds legend Mark Lawrenson, Grealish's move to City last summer impacted Salah's demands.
Speaking on behalf of 888sport, Lawrenson said: "Salah is absolutely and totally up there with the best.
"He plays on the right and he’s left footed and he scores goals for fun. I can’t remember Liverpool ever having a player like that before.
"It’s almost a guarantee of goals if you have Mo. And that’s why it’s a really delicate issue what to do with him. Some supporters are like, how much money does he want? Pay him that.
"But the real issue began when City signed Jack Grealish for £100 million and everybody knows his wages. Mo’s agent probably then thought, well if Grealish is going there for £100m then my boy – who is a much better player and scores tons of goals – should at the very least be on what Grealish is.
"But obviously they’ve got different terms and conditions at City."
Grealish joined City from boyhood side Aston Villa and became the club's most expensive signing and the most expensive English player ever.
He's had a tricky debut campaign at the Etihad, but will be given time to fit in Pep Guardiola's system.
Salah, meanwhile, hasn't ruled out staying in the Premier League if he fails to agree terms with the Reds.
The Athletic claim the Egypt international would rather remain in England and that's put Liverpool's biggest rivals on high alert.
Back in April, Salah said he was 'optimistic' an agreement could be reached.
Salah joined Liverpool from Roma in 2017 and has scored 156 goals in 264 appearances.
In that time, he's become one of the best players in world football and also won the Champions League, Premier League, Carabao Cup and FA Cup.
Despite coming second this season, Jurgen Klopp will see one of his top forwards walk away in the coming weeks.
Sadio Mane is set to leave after six years on Merseyside and Bayern Munich is his likely destination.
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