A Free Syrian Army fighter carries his weapon as he stands in front of graffiti that reads "Daesh (Islamic State of Iraq and the Levant ) down" at the Masaken Hanano neighborhood in Aleppo on Jan. 7, 2014. Photo courtesy of REUTERS/Jalal Alhalabi

Report: Islamic State lost quarter of its Iraq, Syria territory in 18 months

BEIRUT (Reuters) The so-called Islamic State lost an area the size of Ireland -- a quarter of its territory -- to hostile forces in the last 18 months in Iraq and Syria and is likely to further step up attacks on civilians in coming months, according to a report from IHS, a global information company based in Colorado.

The territory controlled by the ultra-hard-line Sunni group shrank from 35,000 square miles  in January 2015, six months after it declared a caliphate in Syria and Iraq, to 26,370 square miles, the research firm said Sunday (July 10).

This has led the group to step up attacks on civilian targets in the Middle East and in Europe and this is likely to intensify, IHS said.

"As the Islamic State's caliphate shrinks and it becomes increasingly clear that its governance project is failing, the group is re-prioritizing insurgency," said Columb Strack, senior analyst at IHS and lead analyst for the IHS Conflict Monitor.

"As a result, we unfortunately expect an increase in mass casualty attacks and sabotage of economic infrastructure, across Iraq and Syria, and further afield, including Europe."

The Iraqi military's recapture of Fallujah, an Islamic State stronghold just west of Baghdad, last month has led the insurgents to step up bombings on Shiite Muslim targets.

Nearly 300 people died when an Islamic State suicide bomber struck in a busy shopping district in Baghdad a week ago, in one of the worst such attacks by the group to date.

Islamic State lost control of the city of Ramadi at the end of last year, another key stronghold for the group, which captured large swaths of Iraq in 2014. The army is now gearing up to retake Mosul, the largest city in Iraq's north and Islamic State's de facto capital.

In Syria, the militants lost ground this year to both Russian and Iranian-backed forces supporting President Bashar Assad and to the U.S.-backed Syria Democratic Forces alliance.

In February the SDF captured the town of al Shadadi, a major logistics hub for the militants, and in March, Syrian and allied forces backed by Russian airstrikes drove Islamic State out of the ancient Syrian city of Palmyra and surrounding areas.

An SDF advance is underway to retake areas north of Islamic State's de facto capital in Syria, Raqqa.

(Reporting by Maher Chmaytelli and Lisa Barrington)