British hostage Kenneth Bigley’s life was tonight in the blood-stained hands of a terrorist who has severed the heads of two other captives.

A headless corpse was found in Baghdad today hours after an al-Qaida-linked group boasted it had killed a second American hostage, leaving the Briton they are holding to face execution.

There was reportedly a glimmer of hope for the distraught family of British hostage Kenneth Bigley when Iraq’s justice minister pledged to release one of the two Iraqi women in custody - a partial concession to the kidnappers’ demands.