The 29-year-old joined the reigning La Liga champions on loan last summer, and he has been a key player for Xavi's side this season, making 29 appearances, scoring three goals and registering four assists.
Cancelo has a contract at the Etihad Stadium until June 2027, but he is unlikely to continue at Man City, as his relationship with the English club's head coach Pep Guardiola is said to have broken down.
The Citizens are said to be preparing to sell the Portugal international this summer, but according to Sport, the English champions will have to accept a cut-price fee in order for him to move to Barcelona permanently.
The report claims that the Catalan outfit are unlikely to offer more than €20m (£17m) and could even come in at an initial €15m (£12.9m).
Barcelona are said to be hopeful that Cancelo will put pressure on Man City to sell, while the role of his agent Jorge Mendes is also expected to be key this summer.
Cancelo has scored twice and registered three assists in 22 La Liga appearances this season, while he has one goal and one assist in seven Champions League appearances.
The Portuguese was signed as a right-back, but he has largely featured as a left-back in 2024, with Alejandro Balde out for the rest of the season following a hamstring operation.
Cancelo made the move to Man City from Juventus in 2019, and he has represented his parent club on 154 occasions, scoring nine goals and registering 22 assists in the process.
The defender has won three Premier League titles and one EFL Cup during his time at the Etihad Stadium, but a breakdown in
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