The 15-minute long grisly video shows the horrific beheading a group of Syrian military prisoners and then the decapitated head of Mr Kassig at the feet of a masked man.
The man, who appears to be the same militant known as Jihadi John who has appeared in other beheading videos, says: "This is Peter Edward Kassig, a US citizen."
He also denounces David Cameron as a puppet of the United States president:
He says: “To Obama, the dog of Rome. Today we are slaughtering the soldiers of Bashar and tomorrow we will be slaughtering your soldiers and 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.”
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