Diouf says the club missed a huge opportunity to win the Premier League title last season and will struggle to compete in the new campaign.
“They were very good last season. I don't think they are going to be able to play like that this season," Diouf told the Mirror.
“They missed the chance to win the title last season, because you know in football every season is different, and if you look at the way they went all out for it last season it will be impossible for them to do it again this season.
“That level they were last season was an unbelievable level and look at the way they lost it, with a point difference, so we have to be realistic to ourselves.
“They have great competitors in City, and they've long been a team that has fought so hard for the title, so for me I maintain that Liverpool will not be able to produce that level of performance they did last season."