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Hi AM,
Thanks for posting back.
I need to apologize for the mistake in my first reply. Sorry for the incorrect information that was provided to you.
I have tested it again, and it is not possible to meet your needs by customizing the permission. If the Delete permission is removed from the Contributors permission level (or other higher permissions), then Contributor users are not able to rename items in SharePoint. This situation is by design.
For your reference:
Also, based on my search, one user mentioned a workaround that may meet your needs. In this thread, Ahmed Safar mentioned using JavaScript to remove the Delete option. Please check if it helps.
Appreciate your understanding and patience.
Sincerely,
George | Microsoft Community Moderator