US hostage is beheaded by Iraqi militants

An American hostage kidnapped by Iraqi militants was beheaded last night as hopes faded for the release of a British man held by the extremists.

An American hostage kidnapped by Iraqi militants was beheaded last night as hopes faded for the release of a British man held by the extremists.

A message posted on an Islamist website said the group led by the Jordanian radical Abu Musab al-Zarqawi had killed Eugene Armstrong, an American it was holding hostage. A short statement said Zarqawi, "God protect him, has beheaded the first American. The group will next behead the others". A video of his execution was later released to an Islamist website depicting Mr Armstrong dressed in an orange jumpsuit surrounded by five black-clad men, one of whom decapitated him. US officials have since recovered his body.

The group stated that the US had a further 24 hours to free all women prisoners in Abu Ghraib and Umm Qasr prisons before they would kill the two remaining hostages.

Kenneth Bigley, 62, a civil engineer from Liverpool, was kidnapped with his two American colleagues, Mr Armstrong and Jack Hensley, in Baghdad on Thursday. Before last night, there had been 25 executions of foreigners in Iraq, and up to 17 hostages were still being held.

Reports of the latest killing emerged hours after a 48-hour deadline set by the men's captors on Saturday had passed. The message on the website was signed by Abu Maysarah al-Iraqi, a pseudonym for a contributor who has posted previous internet messages on behalf of the Tawhid and Jihad group. Earlier, Mr Bigley's brother appealed for mercy on pan-Arabic television.

The deepening of the hostage crisis came as Iraq's interim Prime Minister, Iyad Allawi, was visiting London and Washington for talks on the country's future.

A senior British government source described the hostage-takers last night as "absolutely ruthless" and not prepared to enter into negotiations or listen to the pleas of their captives' families. The bleak assessment was deepened further by an admission that the Government has no direct line of communication with the kidnappers.

A British official said: "We have only reports to go on. It is very difficult as these people are absolutely ruthless and are not prepared to listen to appeals on humanitarian or any other grounds. They are not people you can negotiate with. We are doing all we can to use the channels that we do have to help bring it to a happy conclusion but it is very difficult. I would not say there are direct channels of communication."

The Tawhid and Jihad group admitted responsibility after the men were abducted from their walled house in the wealthy al-Mansour district of Baghdad. Tawhid and Jihad has close links to Zarqawi, a Jordanian-born Sunni militant said by the US to be linked to al-Qa'ida. The group claimed responsibility for the murder of Nicholas Berg, a US citizen. Last May, a shocking videotape appeared to show Zarqawi beheading Mr Berg, 26.

In a videotape shown on al-Jazeera television on Saturday morning, a masked militant from the group threatened to behead the three hostages within two days unless Iraqi women detained in two American-run prisons were released.

Coalition officials insist there are only two female prisoners in American custody in Iraq, both senior scientists in Saddam Hussein's biological weapons programme.

The three hostages were in Iraq working for a Qatar-based construction firm, Gulf Supplies and Commercial Services.

In a televised appeal shown on the al-Arabiya television station, Mr Bigley's youngest brother pleaded for him to be allowed to return home. Philip Bigley said Kenneth, a civil engineer, had grown to love the Middle East after working in the region for the past 10 years.