Fighters from the Islamic State of Iraq and the Levant (ISIL) have reportedly captured up to 3,000 fleeing villagers in northern Iraq, according to the UN refugee agency, or UNHCR.

In its daily report on events in Iraq, UNHCR said on Friday that 12 of the captives were thought to had been executed by ISIL, also known as ISIS.

UPFRONT: Can Iraq's government defeat ISIL?

"UNHCR has received reports that ISIL captured on 4 August up to 3,000 IDPs [internally displaced people] from villages in Hawiga district in Kirkuk governorate trying to flee to Kirkuk city," UNHCR said.

"Reportedly, 12 of the IDPs have been killed in captivity."

The villagers were on the run from fighting in Kirkuk province and seeking safety in the nearby city of the same name, a UN spokesman also told DPA news agency.

Iraqi displaced families arriving in early June in a shelter near Hawiga [File: EPA]

The oil-rich Kirkuk province is divided between areas mainly controlled by the Kurdish autonomous region and areas held by ISIL.

ISIL overran large areas north and west of the capital, Baghdad, in 2014, but has since lost ground to Iraqi forces backed by US-led air strikes and other fighters.

The hardline group has responded to the battlefield setbacks by striking civilians, and experts have warned that there may be further attacks as it continues to lose ground.

Last last month, the International Committee of the Red Cross warned that up to one million Iraqis risk facing displacement in the coming weeks as fighting intensifies ahead of a government offensive to retake Mosul, Iraq's second largest city, from ISIL.

Mosul, which fell to ISIL in June 2014, was once home to some two million people, but the current population has been estimated at around half that figure, with the number of those fleeing their homes increasing.

UNHCR has begun building a site northeast of Mosul for 6,000 people and is preparing another northwest of the city for 15,000, a fraction of those expected to need shelter.

According to the UN, approximately 10 million Iraqis are in need of humanitarian assistance, with 3.3 million already displaced from their homes within the country.

Source: Agencies