No, Pantheism is in no way compatible with Islam. The belief that God is every single thing, is illogical, as well as it is not compatible with the Quran and Sunnah. If God is everything, then He is also weakness and can take on the weaknesses of everything, and this is illogical because God is all powerful and weak in no way like His creation. Furthermore if God was everything, then He would also be of the lowest of things, and God is not low, He is the Most High far above everything. It would also mean that God would have a beginning and an end, but God has no beginning nor end.
We do not believe that God is part of His creation, We believe He is not affected by space or time. Allah Says:
ٱلرَّحۡمَـٰنُ عَلَى ٱلۡعَرۡشِ ٱسۡتَوَىٰ
The Most merciful upon the Throne Established
Suart Taha Ayah 5
Meaning that He (Allah/God) is above and beyond/Outside of His creation and hence not part of it. But we believe His attributes work inside of His creation. He is not affected by place/Space. Furthermore, there is no verse in the Quran nor is there any authentic Hadith that indicate He is everything or that He in essence is everywhere. So that conception of God is in no way compatible with Islam.
