Zirconium alloys are extensively used as cladding material in nuclear reactors. They are vulnerable to hydrogen degradation under the harsh service conditions of the reactors. Optical micrographs taken in some pressure tubes shows the presence of hydride denuded zones closer to the surface, where the hydrides formed in this region are smaller in size compared to the bulk. We investigated the effect of oxygen on diffusivity of hydrogen in α Zr, to check the hypothesis that oxygen slows the diffusion of hydrogen and thereby encourages the occurrence of hydride denuded zones. We used a multi-scale model to simulate H diffusion in Zr with different O concentrations to identify the effect that O has on H diffusivity. From the study we found that oxygen indeed decreases the diffusivity of hydrogen in α Zr for moderate oxygen concentrations. We investigated the diffusion processes of individual H atoms, which showed that the reduction in diffusivity is caused by a decrease in the hopping rates and the formation of hydrogen traps by the combination of several interstitial sites. Though the diffusivity of H seems to be reduced by O, looking at the O concentration profiles found in Zircaloy pressure tubes, we see that the slowing down is insufficient to cause a significant enough change to the size of hydride precipitates. This causes us to reject the hypothesis as the main reason for the formation of denuded zones in Zircaloy pressure tubes.