Manchester City are prepared to risk missing out on Alexis Sanchez - possibly to Manchester United - rather than pay Arsenal's £35m asking price.
It is also understood Sanchez's agent wants £5m for his part in the deal, taking the overall tally to £40m, double what City are willing to pay.
Sanchez, 29, will leave the Gunners in January if a suitable offer arrives and a replacement is secured.
French side Paris St-Germain have also been linked with the Chile forward.
Sanchez's preference is to join City but, especially now Gabriel Jesus' knee injury is not as bad as initially feared, the club do not view such a huge outlay on a player who would be available for nothing in the summer, as being worthwhile.
It had initially been thought Jesus would be out for two months with a knee injury he sustained against Crystal Palace on New Year's Eve, with rumours surfacing the Brazil forward might be out for much longer.
However, at his news conference on Friday, Guardiola said that, after tests in Barcelona on Thursday, it was possible Jesus could be back in action "in two or three weeks".
Manager Pep Guardiola is aware of Sanchez's desire to join them, but City also feel the player is determined to leave Arsenal come what may this month, so their stance could lead to him joining a rival club.
Guardiola would not be drawn on his interest in Sanchez at his news conference on Friday.
He said:"I don't answer.I understand the question, you do your job, you know my answer.I'm focused on Liverpool."
Manchester United spoke to Arsenal in September and Red Devils boss Jose Mourinho is a confirmed admirer, so the Old Trafford club could prove to be an attractive alternative should the impasse not be broken.
It is understood the Gunners hierarchy have accepted that Sanchez is likely to depart after three and a half years at Emirates Stadium.
However, Arsenal are reluctant to sell without replacing Sanchez and their first choice is Bordeaux's 20-year-old Brazilian forward Malcom.
"Normally he would stay until the end of the season - but we'll see," said Gunners boss Arsene Wenger.
Speaking at a news conference on Friday, the Frenchman added:"Nothing is really concrete at the moment and nothing is decided one way or another.Of course I want a quick resolution."
If a deal cannot be agreed with any club, Sanchez will be able to leave when his contract expires in the summer - a situation Arsenal are keen to avoid as they would receive nothing.
|Sanchez's time at Arsenal|
|July 2014 - joins Arsenal for £35m from Barcelona on a four-year deal, despite interest from Liverpool and Juventus|
|May 2015 - finishes the season as Arsenal's top scorer with 25 goals, including a goal in the FA Cup final win over Aston Villa|
|May 2016 - finishes season with 17 goals, despite missing over a month with a hamstring injury, but the Gunners fail to win a trophy|
|May 2017 - top scores for Arsenal again, with 30, as they win the FA Cup but fail to qualify for the Champions League|
|August 2017 - agrees a £55m move to Manchester City, but Arsenal cancel the deal when they fail to sign Thomas Lemar to replace him|
|January 2018 - after the forward scores eight goals in the first half of the season, City again consider signing him with six months left on his deal|
'It would be a coup for United over City'
Former Manchester United defender Phil Neville said Sanchez would be an "absolutely unbelievable signing" for the Old Trafford club.
Responding to reports that said a £25m bid had already been made, he told Sky Sports:"If you look back at Manchester United's big signings over the decades, Eric Cantona came out of the hat, [Robin] van Persie was a surprise - and they both helped United win titles.
"I think this could have a similar impact.He's got the character to play at Old Trafford," the ex-England international added.
"It would be a coup, particularly for United fans, to have a player like Sanchez come to them over City.It would be a strong statement.
"It's pretty obvious he's not going to stay at Arsenal.I think if United were going to buy him, £25m would be an absolute snip."
Meanwhile, former Chelsea goalkeeper Mark Schwarzer has told the BBC that Arsenal should have cut their losses on Sanchez sooner.
"I think Arsenal should have sold him at the start of the season.It was an unbelievable offer from Manchester City that they turned down," said Schwarzer.
"They should have got rid of him.He's not the same player and his mind hasn't been at Arsenal this season.The sooner they get rid of him, the better for Arsenal."...