US air strikes are beginning to choke off the flow of oil revenues to Islamic militants, cutting their income by several million dollars a week, a top US official said Thursday.

Last month, top US Treasury official David Cohen said the Islamic State group, also known as ISIL, was earning about $1 million a day from the black market sales of oil from fields it has seized in Syria and Iraq.

"Because of the air strikes on the ISIL's mobile refineries as well as other military activity we have seen a decrease in... the revenue from the oil sales from about a million a day to several million dollars a week," Cohen told US lawmakers.

"There is some progress there," he said, adding "it is small steps that you can see over the time having a real impact."

The US-led coalition air strikes were "successfully impairing ISIL's ability to sell oil, and so its daily oil revenue has fallen."

The Islamic militants have become one of the best-funded terror groups in the world, so as part of their battle to defeat the jihadists Washington is seeking cut off their revenues.

"ISIL obtains most of its revenues through local criminal and terrorist activities, so one way to cut off those revenues is to cripple ISIL's ability to operate freely on Iraqi and Syrian territory," Cohen told the House financial services committee.

"We have no silver bullet, no secret weapon to empty ISIL's coffers overnight. This will be a sustained fight, and we are in the early stages."

He also stressed the importance of being able to trace the money by sharing intelligence with US partners.

At Treasury there is "a top-notch intelligence shop that helps us understand the landscape of terrorist financing," Cohen said.

"Our ability to combat ISIL's financial strength -- to target those smuggling its stolen oil, to prevent it from gathering donations abroad, to stymie its abuse of the international financial system -- all depends deeply on the quality of the information available to us."