An internet video has emerged which claims to show the beheading of US reporter Steven Sotloff by a member of the Islamic State (IS).

In the video, named "A Second Message to America", the journalist appears in the same orange jumpsuit that he was shown to be wearing in the video of James Foley's killing last month.

The masked IS member, who is believed to be from the UK, addresses US President Barack Obama, telling him: "I'm back, Obama, and I'm back because of your arrogant foreign policy towards the Islamic State ... despite our serious warnings."

"Just as your missiles continue to strike our people, our knife will continue to strike the necks of your people."

The video ends with the IS member threatening to kill British aid worker David Cawthorne Haines next if America and its allies do not leave the Islamic State alone.

Prime Minister David Cameron is set to chair an emergency Cobra meeting with top security officials following the Steven Sotloff beheading and threats made by IS militants against the British captive.