I think he's capable of reaching world number one this year but he's also capable of falling outside the top twenty. There are a lot of contributing factors; his injuries, his swing changes, his personal life, his love for the game.
If he can get to 90% of his very best, he'll win a couple of majors, five other tournaments and finish the year as number one. There have been signs that the clouds are starting to part. Injury will probably be his biggest threat.
It would be awesome to see Woods and McIlroy battling at the last day of a major, like Nicklaus and Watson used to do 35 years ago.