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The Islamic State has released a video claiming to have beheaded American aid worker Peter Edward Kassig on Sunday, sending out a warning message to the United States government.

The video footage showed an ISIS militant standing over the severed head, which he claimed is that of Kassig. Along with it, the video had the footage of mass beheading of at least 18 Syrian military personnel, Agence France-Presse reported.

"This is Peter Edward Kassig, a US citizen of your country. Peter, who fought against the Muslims in Iraq whilst serving as a soldier in the American army, doesn't have much to say. His previous cellmates have already spoken on his behalf," The Guardian quoted the man in the video.

"Here, we are burying the first American crusader in Dabiq, eagerly waiting for the remainder of your armies to arrive," he said.

"But we say to you, Obama ... you claim to have withdrawn from Iraq four years ago. We said to you then that you were liars, that you had not withdrawn. And that if you had withdrawn you would return even after some time – you would return," the man said.

"Your forces will return greater in number than they were before. We also remind you of the haunting words of our Sheikh Abu Musab al-Zarqawi told you. The spark has been lit here in Iraq and its heat will continue to intensify by Allah's permission until it burns the crusader army," he added.

While executing the Syrians, the black-clad militant, who has been named as "Jihadi john," said in the video that "tomorrow" they will be slaughtering American soldiers on the streets of America.

"To Obama, the dog of Rome, today we are slaughtering the soldiers of Bashar and tomorrow we'll be slaughtering your soldiers. With Allah's permission we will break this final and last crusade and the Islamic State will soon, like your puppet David Cameron said, begin to slaughter your people on your streets."

The American government is, however, looking into the authenticity of the video and Kassig's family in Indiana does not wish to speak anything until it is confirmed if the severed head in the video was their son's or not, BBC reported.

"If confirmed, we are appalled by the brutal murder of an innocent American aid worker and we express our deepest condolences to his family and friends," NSC spokesperson Bernadette Meehan said.

Kassig, 26, is now known as Abdul Rahman Kassig, the name opted after he converted to Islam. Before being kidnapped in 2013 in Syria's Deir Ezzor province, Kassig was working in hospitals and clinics treating Syrian patients who had fled to Turkey and Lebanon.

Before executing Kassig, ISIS beheaded two American journalists James Foley and Steven Sotloff and two British aid workers Alan Henning and David Haines.