The fusion of hyperspectral image (HSI) with multispectral image (MSI) provides an effective way to enhance the spatial resolution of HSI. However, due to different acquisition conditions, there may exist spectral variability and spatially localized changes between HSI and MSI, referred to as inter-image variability, which can significantly affect the fusion performance. Existing methods typically handle inter-image variability by applying direct transformations to the images themselves, which can exacerbate the ill-posedness of the fusion model. To address this challenge, we propose a Degradation-based Low-Rank and Residual Fusion (DLRRF) model. First, we model the spectral variability as change in the spectral degradation operator. Second, to recover the lost spatial details caused by spatially localized changes, we decompose the target HSI into low rank and residual components, where the latter is used to capture the lost details. By exploiting the spectral correlation within the images, we perform dimensionality reduction on both components. Additionally, we introduce an implicit regularizer to utilize the spatial prior information from the images. The proposed DLRRF model is solved using the Proximal Alternating Optimization (PAO) algorithm within a Plug-and-Play (PnP) framework, where the subproblem regarding implicit regularizer is addressed by an external denoiser. We further provide a comprehensive convergence analysis of the algorithm. Finally, extensive numerical experiments demonstrate that DLRRF achieves superior performance in fusing HSI and MSI with inter-image variability.