Update: The Orioles are unwilling to offer Saunders a three-year deal, according to Eduardo A. Encina of the Baltimore Sun. He adds that Saunders had been looking for a four-year deal last month.
Saunders is likely the best southpaw starter on the free-agent market, and interest in him has reportedly been high, with the Mariners, Mets, Padres and Twins joining the Orioles in showing some level of interest.
Saunders, 31, went 9-13 with a 4.07 ERA, 1.34 WHIP and 112 strikeouts in 174 2/3 innings in 2012 while pitching for the Orioles and Diamondbacks. He posted two one-inning, 5 2/3-inning performances for the Orioles in the playoffs, including picking up the win against the Rangers in the wild-card round.
Rosenthal also reports that the Mariners are searching for a starting pitcher in addition to hitting help, but that the price for Kyle Lohse might be too high.
For more up-to-the-minute news and analysis on the latest rumors from bloggers Chris Cwik, Jack Moore and R.J. White, follow @MLBRumorsCBS.