The 19-year-old Manchester City midfielder is frustrated by a lack of first-choice opportunities and is now in the final few months of his contract, with Real Madrid keeping a keen eye on developments.
Pep Guardiola will make a number of changes for the trip to the Kassam Stadium as his team defend the trophy they won last season against Arsenal at Wembley.
Diaz refused a loan move to Girona in the summer and the Spaniard, who has been a Citizen since the age of 14, is free to talk to clubs on the continent in January.
It is understood the talented teenager wants to wait and see how the next couple of months play out before deciding to sign improved terms worth around £30,000 per week, with City desperate to avoid a repeat of the situation that saw England starlet Jadon Sancho quit the club for Borussia Dortmund last year.
Along with Diaz, right-back Danilo may make his first appearance of the campaign after recovering from the ankle injury sustained during training at the World Cup with Brazil.