Analysis of U.S.-led airstrikes on Islamic State targets in Iraq and Syria finds the group's ability to exploit oil for a source of revenue has been diminished.

Analysis published Friday by the Energy Intelligence Group estimates around 4,000 air sorties launched by U.S. forces and their allies have knocked out about half of the refinery capacity captured by the group calling itself the Islamic State.

"Air power alone will not defeat Islamic State, but it has dealt the jihadists' oil industry a significant blow," the report said.

The terrorist group in control of parts of Syria and Iraq is said to be generating about $2 million per day on pilfered oil. Iraqi leaders and peace advocacy groups have said action must be taken to contain oil's role in IS financing.

Friday's report said the biggest loss for the militant network is the destruction of its oil processing capabilities in Syria.

"In addition to significant tax revenues, this helped provide a steady supply of diesel and gasoline for the broad base of people Islamic State now claims to rule and, most significantly, fuel for its fleet of military vehicles," the briefing read.

The Kurdish government in control of parts of northern Iraq said security has improved to the point that oil and gas companies were operating at near capacity. Gulfsands Petroleum, one of the last companies to suspend operations in Syria, said this week its installations in the country were secure.