(MSN) - With nearly two months left in the year, 2007 is on course to be the deadliest year on record for American forces in Iraq, despite a recent sharp drop in U.S. deaths. At least 847 American military personnel have died in Iraq so far this year _ the second-highest annual toll since the war began in March 2003, according to Associated Press figures. If four more U.S. troops by the year's end, this year will surpass 2004 as the bloodiest year of the war for the U.S. Some 850 troops died in 2004, mostly in larger, more conventional battles like the campaign to cleanse Fallujah of Sunni militants in November, and U.S. clashes with Shiite militiamen in the sect's holy city of Najaf in August. But the American military in Iraq reached its highest troop levels in Iraq this year _ 165,000. Moreover, the military's decision to send soldiers out of large bases and into Iraqi communities means more troops have seen more "contact with enemy forces" than ever before, said Maj. Winfield Danielson, a U.S. military spokesman in Baghdad. "It's due to the troop surge, which allowed us to go into areas that were previously safe havens for insurgents," Danielson said. "Having more soldiers, and having them out in the communities, certainly contributes to our casualties."