How Much Is Gas in Iceland? (2026 Data)

In September 1996 a litre of petrol in Iceland cost 76.5 ISK¹ - worth about 298 ISK² in today's money once inflation is counted. Nearly thirty years on, the pump price is 258.6 ISK³ a litre, and this year alone it has moved twice: Iceland scrapped its old fuel taxes for a distance-based road charge on 1 January 2026, then cut VAT on fuel for four months over the summer before letting it snap back on 1 September. Neither change was really about the world price of oil.

This report tracks what petrol and diesel cost in Iceland right now, per litre and per US gallon, how the price has moved since 1996, and how Iceland compares with other countries. Fill a 50-litre tank today and it costs about 12,929 ISK² ($$107); drive the whole Ring Road and it runs closer to 25,387 ISK². Norwegians and Danes pay more for the same litre; Americans pay much less.

How much is gas in Iceland right now

As of 2026-09-15, the Gasvaktin price tracker puts the nationwide average petrol price at 258.6 ISK³ a litre and diesel at 292.8 ISK³. A day-by-day snapshot of all 245³ tracked filling stations, taken 2026-09-16, shows petrol ranging from 222.3 ISK³ at the cheapest pump to 270.4 ISK³ at the priciest - a spread of about 48 ISK depending on which station you stop at.

By company, N1³ is the most expensive on average at 267.5 ISK³ a litre, while Costco³, which requires a membership, is cheapest at 222.3 ISK³. Loyalty-card discounts bring most companies' prices down further still.

How much is gas in Iceland per gallon

A US gallon is 3.785 litres, so at today's average price petrol works out to about 979 ISK² a gallon, or $8.07². Diesel comes to about 1,108 ISK² a gallon, or $9.13². So how much is a liter of gas in Iceland in the reader's own currency? At the litre level it is $2.13² for petrol and $2.41² for diesel, using the Central Bank of Iceland's mid rate of 121.33 ISK⁴ to the US dollar on 2026-09-15.

How much is gas in Reykjavik

Fuel is, on average, cheaper in the capital than outside it: stations in the Reykjavík capital area average 255.8 ISK² a litre for petrol, against 263.7 ISK² in the rest of the country, a gap of about 7.9 ISK (own calculation from each station's coordinates). More filling stations compete for business in and around Reykjavík - 75 of the 245 tracked stations sit in the capital region - which keeps prices there a little lower than in small towns with only one or two pumps.

Average Petrol Price: Iceland, 2025 per Liter

Petrol in Iceland cost just 76.5 ISK¹ a litre in 1996. It climbed through the 2008 financial crisis, when the króna lost roughly half its value against the dollar, past 200 ISK¹ by 2010 and on to an all-time nominal high of 318.0 ISK¹ in 2023. Average petrol price Iceland recorded for 2025 was 309.8 ISK¹ a litre (about $2.41), barely changed from 2023 and 2024. Then came 2026: with January's reform included, the partial-year average so far is 228.5 ISK¹, the lowest since 2018.

The chart fits a straight line to the years since 2005 and projects it to 2050 - a naïve trend only, since it cannot see policy changes like January's reform coming. Read it as a baseline, not a forecast.

How much is diesel in Iceland

Diesel has generally tracked petrol closely, though the ranking flipped: since 2022, diesel has cost slightly more than petrol most years, the opposite of the pattern before 2020. Iceland diesel price per liter 2025 average was 317.8 ISK¹, and the partial 2026 figure is 256.4 ISK¹.

For comparison, the average gasoline price Iceland 2025 per liter figure - "gasoline" being the American word for the same 95-octane petrol sold at Icelandic pumps - was 309.8 ISK¹, just below diesel's 2025 average.

Why gas got cheaper in Iceland in 2026

Two policy changes, not the world oil price, explain most of this year's swings. On 1 January 2026, Iceland abolished the excise duty and oil fee charged on every litre of petrol and diesel, raised the carbon tax a little, and introduced a per-kilometre road charge for every vehicle instead. Statistics Iceland's consumer price index shows the effect directly: petrol fell 27.4% and diesel 24.2% in January alone, knocking 0.68 and 0.26 points respectively off that month's headline inflation figure.⁵ Our own before-and-after calculation, comparing December 2025 with February 2026 monthly averages, finds a similar-sized drop: petrol down 86 ISK² a litre (29.2%) and diesel down 81 ISK² (26.5%) - close to the government's own estimate of a 95–105 ISK cut for petrol and 80–88 ISK for diesel.⁶

A second, temporary change followed in May: facing an oil-price shock from the conflict in the Middle East, the government cut VAT on fuel from 24% to 11% for four months.⁷ Our calculation shows petrol averaging 224.0 ISK² a litre during that window, versus 243.7 ISK² in April before the cut - a drop of about 8.1%. The cut expired at midnight on 31 August, VAT reverted to 24%, and by mid-September petrol had climbed back to 254.5 ISK², up about 13.6% from the summer average.

How much is gas in Iceland in US dollars

Converting at the Central Bank of Iceland's mid rate of 121.33 ISK⁴ to the dollar on 2026-09-15, today's average works out to $2.13² a litre for petrol and $2.41² for diesel. Because the króna moves against the dollar from year to year, the yearly table above converts each year at that year's own average exchange rate rather than today's rate, so a past year's dollar figure reflects what it actually cost at the time.

For British visitors: how much is petrol in Iceland in pounds? At the Central Bank's mid rate of 163.59 ISK⁴ to the pound, that same litre of petrol costs about £1.58², or roughly £5.98 a gallon.

How much was gas in Iceland in past years

How much is gas in Iceland 2016

In 2016, petrol in Iceland averaged 196.0 ISK¹ a litre and diesel 184.9 ISK¹, which worked out to about $1.62² and $1.53² at that year's average exchange rate of 120.67 ISK² to the dollar. Prices were near a post-crisis low that year, before oil markets tightened again.

How much is gas in Iceland 2017

The following year barely moved: petrol averaged 198.8 ISK¹ a litre (about $1.86) and diesel 188.4 ISK¹ (about $1.76), even though the króna strengthened sharply that year, which is why the dollar price rose more than the ISK price.

How much is gas in Iceland 2022

That year has a clear answer: prices spiked. Petrol jumped from 268.4 ISK¹ a litre in January to 341.9 ISK¹ in July, as Russia's invasion of Ukraine drove world oil prices higher, before easing slightly to end the year at 322.6 ISK¹. The full-year average was 313.6 ISK¹ (about $2.32), Iceland's highest nominal yearly average until then.

Is Iceland's gas price a record right now

Not once inflation is taken into account. The nominal average gas price in Iceland has risen almost every decade, but Iceland has also had high inflation, so a like-for-like comparison needs today's money. Rescaling every month of the Gasvaktin/FÍB series by Statistics Iceland's price-level index, 76.5 ISK¹ in September 1996 turns out to be worth about 298 ISK² today - nearly what petrol costs right now. The real peak came later: petrol touched 466 ISK² a litre in today's money in Apr 2012, and diesel a similar 463 ISK² the month before, when oil prices were high and the króna was weak after the financial crisis. Even 2023's nominal record of 318.0 ISK¹ was only 372 ISK² in today's terms - well short of 2012.

Average Fuel Price: Iceland, 2025, ISK per Liter - What It's Made Of

Before the 2026 reform, the Icelandic Automobile Association (FÍB) broke down exactly what was in a litre of fuel. On its analysis, taxes made up about half: 51.5%⁸ of the petrol price and just under 48%⁸ of the diesel price, with margin, transport and other costs taking another 23–24%⁸ and the underlying import and product cost - the part that actually moves with the world oil price - only about a quarter⁸. On a 310 ISK litre of petrol, FÍB calculated close to 160 ISK⁸ went to the treasury in excise duty, carbon tax and VAT; filling a 50-litre tank meant paying roughly 8,000 ISK⁸ in tax alone.

That old structure no longer applies. The 88 ISK/L petrol excise duty and 75.40 ISK/L diesel oil fee are gone, replaced by the per-kilometre charge; the carbon tax went up instead, and VAT still applies to everything else. No official breakdown of the new price has been published yet, so the chart below shows the pre-reform structure, clearly dated, as the most detailed public explanation of how Icelandic fuel pricing works.

Before January 2026, a rise in the pump price often meant a rise in tax revenue too; since the reform, fuel tax is a smaller, flatter part of the price and drivers instead pay for the roads by the kilometre, however much or little fuel their car needs.

Fuel Price by Company in Iceland

Six companies sell fuel in Iceland: N1 and Olís run full-service forecourts and shops, while Orkan, ÓB, Atlantsolía and Costco are largely unstaffed, self-service pumps that undercut them. The table below lists every company's average and lowest logged price with a loyalty card, alongside how many of the 245 tracked stations each one runs.

How much is gasoline in Iceland

"Gasoline" is simply the American English word for what Icelanders call bensín and the British call petrol - all three describe the same 95-octane fuel sold at every Icelandic pump; there is no separate "gasoline" grade to compare. Some stations also sell a higher-octane 98 blend at a small premium, but 95-octane is what the prices on this page describe unless stated otherwise.

How Much Is Fuel in Iceland by Month

Iceland's pump price does not follow a fixed seasonal calendar the way, say, heating costs do - it moves with world oil prices and the exchange rate, which can shift in any month. The clearest recent example is 2022, when petrol climbed for seven months in a row: from 268.4 ISK¹ in Jan to a high of 341.9 ISK¹ in July, as the invasion of Ukraine pushed crude oil prices to their highest since 2008, before drifting back down to end the year at 322.6 ISK¹.

How Iceland's Gas Prices Compare With Other Countries

At $2.09⁹ a litre, petrol in Iceland sits in the middle of the Nordic and western European pack: cheaper than in Norway ($3.16⁹) or Denmark ($3.0⁹), similar to the United Kingdom ($2.27⁹), and well above the United States ($1.23⁹), where fuel carries far less tax. Diesel follows a similar order, at $2.38⁹ in Iceland against $3.14⁹ in Denmark and $1.66⁹ in the US.

How Much Fuel Does a Car Use in Iceland

Iceland's road-tax reform had to settle on an answer to the average fuel consumption car Iceland runs, because the whole 6.95 ISK/km charge was set to match what that car paid in fuel tax before. The government's working assumption: a petrol passenger car using 7.5 litres⁶ per 100 km (about 31 miles per US gallon) and covering 14,000 km⁶ a year (about 8,699 miles).⁶

On that assumption, monthly costs stay close to flat: about 28,244 ISK⁶ a month under the old, fuel-tax system versus 26,580 ISK⁶ under the new per-kilometre one. The charge itself is 6.95 ISK⁶ per km for cars and SUVs under 3.5 tonnes, 4.15 ISK⁶ for motorcycles (40% less), and up to 45.17 ISK⁶ per km for the heaviest trucks, spread across 29 weight bands. An electric car costs roughly 13,850 ISK⁶ a month less to run than a comparable petrol car under the new system, since it pays no carbon tax and less vehicle tax and VAT.

How Much to Budget for Gas in Iceland

For a rough trip budget, work from the per-litre price and how far you plan to drive. A small petrol car doing the full 1,309 km (813-mile) Ring Road at 7.5 L/100 km would use about 98.2 litres² of petrol, costing around 25,387 ISK² ($$209); a thirstier diesel 4x4 would spend closer to 28,745 ISK² ($$237). That is on top of the kilometre fee itself, which comes to 9,098 ISK⁶ for the same distance at 6.95 ISK/km.

How much is a tank of gas in Iceland

Filling a 50-litre tank - typical for a small hatchback - costs about 12,929 ISK² ($$107) with petrol or 14,640 ISK² ($$121) with diesel at today's prices. Larger 4x4s and campervans often carry 60–80-litre tanks, so budget proportionally more.

What the 2026 Reform Means for Drivers

For the average petrol car the reform was designed to be close to cost-neutral - 28,244 ISK a month became 26,580 ISK - but "average" hides real winners and losers. A rural driver in a heavier, thirstier vehicle now pays the same per-kilometre rate as a city driver in an efficient small car, so the fuel-tax savings can outweigh the new charge; drivers of the most efficient petrol and hybrid cars, who paid the least fuel tax before, see the smallest gain. Electric-car owners keep a clear cost advantage, about 13,850 ISK a month, since they pay no carbon tax at all.

The summer's VAT cut and its reversal was a separate, temporary story layered on top: petrol was about 8.1% cheaper during the four-month cut than the month before it, and climbed roughly 13.6% once the standard rate returned in September. None of this reflects a change in the world price of oil - it is entirely the result of two Icelandic tax decisions made months apart in the same year.

Conclusions

1. Two Icelandic tax decisions, not the world oil price, explain almost all of this year's price swings: the January kilometre-fee reform cut petrol about 27% and diesel about 24%, and the May–August VAT cut and its September reversal moved petrol a further 8.1% down and then 13.6% back up.
2. Today's price is not a record. Once inflation is counted, petrol cost more in Apr 2012 (about 466 ISK a litre in today's money) than it does now, even though the nominal price has risen more than threefold since 1996.
3. Where and who you buy from moves the price more than the national average suggests: choosing Costco over the priciest station, or filling up in the capital rather than a small town, is worth tens of ISK a litre - a bigger swing than many single-year moves in the chart above.
4. The reform redistributes the burden rather than raising it: a rural driver in a heavier vehicle now pays the same per kilometre as a city driver in an efficient small car, while electric-car owners keep the roughly 13,850-ISK-a-month advantage they already had.