Syria’s army declared victory over the Islamic State (ISIL) militant group on Thursday, saying its capture of the jihadists’ last town in the country marked the collapse of their self-declared caliphate.

The army and its allies say they are still fighting ISIL in desert areas near the eastern town of Albu Kamal, which was the group’s last major urban stronghold in Syria.

Government troops earlier linked up with Iraqi forces at the border after taking the nearby city of al-Qaim.

ISIL already lost its Iraqi stronghold of Mosul in July, as well as Raqqa, its de facto capital in Syria, last month.

The end of Islamic State? Not so fast

The last appearance of Abu Bakr al-Baghdadi, who declared himself caliph and heir to Islam’s historic leaders from the great medieval mosque of Mosul in 2014, was made in an audio recording in September.

Still, all the forces fighting ISIL in Syria and Iraq expect a new phase of guerrilla warfare. Western security chiefs have also said the group’s loss of territory does not mean an end to the “lone-wolf” attacks with guns, knives or trucks ploughing into civilians that its supporters have mounted around the world.

Aggravating the region’s tensions – and raising the possibility of turmoil from which ISIL could benefit – is a contest for power between Iran and Saudi Arabia.

The rivalry escalated in recent days when Riyadh accused Lebanese Hezbollah of firing a missile from the territory in Yemen of another Iranian ally, the Houthi movement.

Hezbollah is a critical part of the Tehran-backed alliance helping Syrian President Bashar al-Assad fight ISIL, and it’s believed to have played a key role in ousting the militants from Albu Kamal.