If I was Liverpool I would try to keep Mo Salah for a few more years instead of trying to replace him with another expensive player and instead I would put 2-3 promising young cheap players under his training and at least one should hopefully be able to learn from him and one day replace him. That would be the best thing the club could do in my opinion and they would save or even earn a lot of money.
Liverpool probably doesn't want to pay Salah a higher salary than they already pay him next season and that could be the reason why there is no talk of extending his contract so far, because Salah is no longer a young player and Liverpool are looking at him as a player who could only perform well in one more season, so they wouldn't want to have a long-term contract with Salah
and I highly doubt that Salah will accept a contract of only 1 year and with the same salary that he earns. This impasse will make him leave the team and go to Saudi Arabia if they make him a big offer, Salah's age means he has to think about retirement, which is why I would agree with him if he went to Saudi Arabia