His performance keep dropping since the last season, this season even worse.
It's hard to expect his performance will back in the next season, but the problem is Manchester City currently don't have a deserved player who can replace De Bruyne. Extend his contract for one more year doesn't sound bad.
Manchester CIty can use one year to find better player, whether it's Marmoush or sign a new top attacking midfielder.
Players like KDB are not given an extended contract only because of their performance but for experience and past contribution to the club. His recurring injuries might be another reason why Manchester City might want to let him go. It could also be that he wants to leave to gain experience from another league..
I also wouldn't believe this rumor too much plus Jurgen Klopp just took over as Global Sports Director at RB Leipzig. So it's quite difficult for him to return too soon to a big European Club to take the coaching seat. But when talking about pressure, of course holding a club as big as Madrid is a bigger and more challenging demand. Back to Klopp does he want to feel that challenge again and get out of his comfort zone?
Jurgen Klopp's agent, Marc Kosicke have disputed the rumour. He stated that the German is okay with his role as the Global Head of Soccer at Red Bull. So this news is just speculations from some people due to the knockout of Real Madrid from the UCL.