(Adds numbers of ISIL fighters)
By Mark Hosenball
WASHINGTON, June 24 (Reuters) - Sunni militants are "well positioned" to hold a broad swathe of territory captured in northern and western Iraq if the Baghdad government fails to produce a robust counter-offensive, a senior U.S. intelligence official said on Tuesday.
The Islamic State in Iraq and the Levant (ISIL), which seized the main northern city Mosul on June 10 and has since marched virtually unopposed towards Baghdad, is at its strongest "in years," said the official, who spoke on condition of anonymity because they were discussing sensitive information.
The official said ISIL risks over-extending itself if it expands too quickly.
The official said ISIL is flush with money and weapons after looting military equipment in Syria and Iraq and raising money through kidnapping, robbery, smuggling and extortion schemes, including the imposition of a "road tax" in Mosul. The official, however, disputed media reports suggesting ISIL's income had soared into the hundreds of millions of dollars, noting its takings in Mosul amounted to "millions" of dollars.
ISIL had bolstered its ability to take and hold territory by striking alliances with local Sunni religious leaders and tribes, and by conscripting local men into its ranks, the official said.
But some local alliances remain fragile. ISIL already has created a backlash in Syria with policies of sometimes indiscriminate violence, earning it the denunciation of the remaining central leadership of al Qaeda, which has disowned ISIL and proclaimed a rival group, Jabhat al Nusrah, as its official Syrian affiliate.
The sudden dash across northern Iraq by armed groups, led by ISIL which seeks to annihilate Shi'ites, has left the Shi'ite dominated government in Baghdad struggling to mount an effective counter-offensive. Crucially, ISIL fighters have received support from Sunni tribes who once fought bitterly against them, a sign of widespread Sunni alienation from Baghdad since the end of U.S. occupation.
U.S. intelligence agencies estimate that ISIL has fielded a total of about 10,000 fighters, with between 3,000 and 5,000 fighting in Iraq and the rest in Syria. Officials said that it was difficult to estimate how many of the ISIL fighters currently in Iraq are foreigners. (Editing by Jason Szep and Grant McCool; Editing by Ken Wills)