Iraqi intelligence says that al-Qaeda in Iraq’s leadership has taken a powder.  The main leader, Abu Ayyub al-Masri, has taken several of his top commanders and fled to Afghanistan or Pakistan, leaving behind an organization in chaos.   AQI mid-level commanders insisted to the Washington Post that the leadership just needed to touch base with the home office and would come back any time they desired:

The leader of the Sunni insurgent group al-Qaeda in Iraq and several of his top lieutenants have recently left Iraq forAfghanistan, according to group leaders and Iraqi intelligence officials, a possible further sign of what Iraqi and U.S. officials call growing disarray and weakness in the organization. …

Some al-Qaeda in Iraq members blamed the group’s troubles on failed leadership by its head since 2006, an Egyptian who has used the pseudonyms Abu Hamza al-Muhajer and Abu Ayyub al-Masri. Some of the fighters said they have become so frustrated by Masri that they recently split off to form their own Sunni insurgent group.

Abdullah al-Ansari, an al-Qaeda in Iraq leader in Fallujah, said in an interview with a Washington Post special correspondent that Masri had traveled to Afghanistan through Iran and designated Abu Khalil al-Souri, the pseudonym of another top leader of the group who came to Iraq in 2003, to run the organization in his absence. …

Makki Fawaz al-Milehmi, a senior leader of the group north of Fallujah, said in an interview with the Post special correspondent that Masri has left Iraq twice before and was going to meet with “some of our brothers” in Afghanistan. “The rumors now are saying that he escaped and this is not true. He just traveled,” said Milehmi, who accused the U.S. government of spreading the rumors to hurt the morale of the group. “He will come back to Iraq anytime he wants, like he has done before.”

Does that really make any sense?  AQI got pushed out of Mosul, Nineveh, and Anbar over the last eighteen months.  Now the Iraqi Army has taken aim at their last real stronghold in Diyala, with American forces in strong support.  Normally, a commander that had a commitment to victory would stay in the theater to direct his forces at this point, not suddenly remove himself and his top lieutenants to a place a thousand miles away for “consultations”.

The US takes a more cautious tone than does Iraqi intelligence, but they see the same dynamic.  AQI has failed in Iraq, and the AQ structure has to decide whether continuing the fight there is worth the losses they will take.  Recruitment has fallen precipitously for this theater as the Iraqi Sunnis have turned against AQI.  Foreign fighters have slowed to a trickle, and they could be used to better effect in Pakistan and Afghanistan, at least at the moment.

However, AQ understands that a withdrawal from Iraq would be a public-relations disaster.  They garner recruits by convincing them that Allah has given them a mission to restore the Caliphate and take over the world.  How can that be true if the infidels destroy them in Iraq, right in the geographic center of the Islamic world, and even its Muslims defeat them?  A retreat would cripple their prestige; it would make them just another set of nutcases with guns, explosives, and money, and perhaps running low on all three.

The likely conclusion will be that AQ stops sending men and support to AQI while publicly supporting their efforts.  Instead of explicitly admitting defeat, they will let AQI die quietly under the boots of the Iraqi Army while pretending it still exists in any meaningful form.  They can add it to their list of fantasies.