The predictable recapture of the northern Iraqi city of Mosul from Islamic State (IS) marks a new milestone in the tumultuous events of the Middle East. It has important ramifications for Iraq, IS and the West.

Iraqi Prime Minister Haider al-Abadi wasted no time claiming victory, entering the ruined city in staged jubilation. Wearing military uniform, al-Abadi was swift to capitalise on the victory, signalling his authority over the entire country. He hopes to keep Iraq united through strengthened political clout on his return to the politically polarised capital of Baghdad.

But the capture of Mosul may in fact accelerate the eventual break-up of Iraq into smaller states. The leader of the autonomous Kurdish regional government, Masud Barzani, has made clear his intentions to hold a referendum on independence by the end of 2017.

Until now, Barzani had to collaborate with the central Iraqi government to clear the IS menace from Mosul and northern Iraq. Now he will have to tread carefully to meet the growing Kurdish expectation of independence and manage al-Abadi's anticipation of gratitude for the liberation of Mosul.

Barzani and Kurds can see a historic opportunity to create a Kurdish polity in northern Iraq. The gravity of this polity is eventually expected to pull neighbouring Kurdish regions in Syria, Iran and Turkey. The Kurdish dream is to combine these regions to create a larger Kurdish state.

At the same time, al-Abadi will increase pressure on Barzani to remain loyal to a unitary Iraq. While the prime minister will spend most of his time in the safety of the Baghdad green zone, Barzani will collaborate with US forces and heavily armed Syrian Democratic Forces (SDF) to oust IS from its capital, Raqqa. He will also play a key role in further clearing operations in eastern Syria in the second half of 2017 and possibly into 2018.

With the fall of Mosul, the impending capture of Raqqa, and the confirmed death of its leader, Abu Bakr al-Baghdadi, IS's days as a caliphate are numbered. Although some argue that IS will transform into a virtual caliphate, without a sovereign state a caliphate is meaningless and Islamically invalid.

This reality has a dramatic impact on the recruiting power of IS. It was able to attract followers with its claim to have resurrected the caliphate abolished by Mustafa Kemal Ataturk in 1924.

IS gained an almost miraculous aura after capturing Mosul with 800 fighters. In their eyes, this was proof that God was on their side. A few weeks after the capture of Mosul, al-Baghdadi declared his caliphate in the city's historic mosque in June 2014.

For as much as Mosul had symbolic value for an IS caliphate, its loss signals an irreversible trajectory of collapse. Although IS is taking huge blows, there is no reason to believe it will disappear, much like the frustrating persistence of Taliban in Afghanistan since the collapse of its government in 2001.

Nobody should expect mass desertions from IS ranks. Its membership is likely to remain loyal and fight to the end. What remains of IS leadership holds to the theological line that the pledge of allegiance or bay'ah is binding before God, and if they abandon ranks they will die in a state of disbelief.

While this may help retain surviving militants, IS recruiting power around the world will dramatically reduce, as the greatest attraction for recruits was the promise of a utopian Islamic state.

Nevertheless IS, or whatever the group will be called in the future, will adapt and look for new missions to motivate its members and attract recruits.

One possible trajectory is a merger with al-Qaeda. This is a real possibility, as IS emerged from al-Qaeda branches in Iraq and Syria. Without a real caliphate, the line of distinction between IS and al-Qaeda blurs to insignificance, even though their leaderships were in open hostility and competed for the soul of the violent radical movement.

The ideology and the narrative of IS and al-Qaeda are the same: Western powers and their local collaborators are responsible for the occupation of Muslim territories and the ensuing suffering of Muslim populations; violent military response is the response these enemies understand and the only solution that works.

This ideology is conveniently covered by the same veneer of religious arguments to utilise the persuasive power of Islam in gaining and rallying gullible supporters to their ranks.

The more likely trajectory for IS is to ignore the spectacular failure of its state and cling to the alluring promise of a caliphate. Persisting with its brand of radicalism, IS could exist as a violent insurgent movement positioned in Deir ez-Zor, a Syrian town near the border with Iraq.

For the time being, the US administration seems determined not to leave IS any haven, Deir ez-Zor or elsewhere.

As IS regroups, it is likely to unleash violence on two fronts. The first is in the West. IS will attempt to use its sleeper cells and deploy social media to motivate a new generation of gullible minds to carry out terror attacks in North America, Europe and perhaps Australia.

The second front is where IS is based – Iraq and Syria. The conditions that gave rise to IS in the first place, such as military conflict, political instability, sectarian polarisation, ethnic divisions and corruption, continue to exist in both countries. The situation will not change overnight.

Through a drawn-out insurgency and waves of violence, IS will attempt to destabilise the Iraqi and Syrian governments in the hope of resurrecting its Islamic state. Ironically, the greatest victims will be Islam, Muslims and peace in Muslim lands.