The American forces can neither crush the insurgency in western Iraq nor counter the rising popularity of the Al-Qaeda terrorist network in the area, the Washington Post reported on Tuesday, citing a secret Marine Corps intelligence report.
The five-page report, written in August, focuses on the largely Sunni Iraqi province of Al-Anbar.
As of mid-November the problems remained the same, a senior US intelligence official told the Post.
"The fundamental questions of lack of control, growth of the insurgency and criminality" remain the same, said the official, speaking on condition of anonymity.
According to the report, "the social and political situation has deteriorated to a point" that US and Iraqi troops "are no longer capable of militarily defeating the insurgency in al-Anbar," the Post reported.
The secret report was written by Marine Colonel Peter Devlin, a senior military intelligence officer with the Marine Expeditionary Force in the region.
According to the Post, it did not appear to have been shared with Iraq's military.
Iraq's Sunni population is "embroiled in a daily fight for survival," fears "pogroms" by the Shiite majority, and is increasingly dependent on Al-Qaeda in Iraq as its only hope against growing Iranian dominance in Baghdad, the report reads.
"From the Sunni perspective, their greatest fears have been realized: Iran controls Baghdad and Anbaris have been marginalised," says the report, according to the Post.
Barring an additional 15,000 to 20,000 US troops deployed to the region in addition to billions of dollars in aid, "there is nothing" US troops "can do to influence" the insurgency, the report reads.
The report describes Al-Qaeda in Iraq as the "dominate organisation of influence" in the province, more important than local authorities, the Iraqi government and US troops "in its ability to control the day-to-day life of the average Sunni."