Iceland is a dream destination, and for many, the best way to see it is on a road trip. The freedom of driving allows you to experience Iceland’s otherworldly landscapes at your own pace. You can stop to marvel at waterfalls, hike across volcanic terrain, and chase the Northern Lights without being tied to a tour schedule.
However, the reality of exploring Iceland by car comes with a cost. And that cost can be high when you see the prices at the pump. Iceland consistently ranks as one of the most expensive countries in the world for gas.
This guide breaks down the cost of gas in Iceland, explaining the factors that contribute to those high prices. We’ll also give you practical tips to help you save money on fuel so you can enjoy your Icelandic adventure without breaking the bank.
Current Fuel Prices in Iceland
Gas prices in Iceland can fluctuate, and they’re often higher than what you might be used to paying in the United States or Europe. Here’s a snapshot of what you can expect to pay at the pump right now.
Latest Gasoline Prices
According to GlobalPetrolPrices.com, the average price of gasoline (petrol) in Iceland is currently [insert current price in ISK here] per liter. That’s roughly [insert USD equivalent] or [insert EUR equivalent].
[Insert info about recent price trends, e.g., Prices have increased slightly over the past month due to seasonal demand.]
Latest Diesel Prices
Diesel is also widely available in Iceland. The current average price is [insert current price in ISK here] per liter, or approximately [insert USD equivalent] / [insert EUR equivalent].
[Insert info about recent price trends, e.g., Diesel prices have remained relatively stable in recent weeks.]
How Prices Fluctuate
Keep in mind that these are average prices. You might find that prices vary between different gas stations and regions. Also, prices can change frequently, so it’s always a good idea to check the current price before filling up your tank.
What influences the cost of gas in Iceland?
Several factors combine to make gas prices in Iceland what they are.
Iceland’s location and logistics
As a remote island nation, Iceland has to import all of its fuel. The added transportation costs get passed on to the consumer at the pump.
It’s also a challenge to distribute fuel across the country, especially to more remote areas. That logistical challenge can add to the price, as well.
Taxes and levies
A significant portion of what you pay at the pump in Iceland goes to taxes. These taxes include:
- VAT (Value Added Tax)
- Special excise duty
- Excise duty on gasoline
- Carbon tax
These taxes serve several purposes, including raising revenue for the government and encouraging environmental protection.
Economic factors
Basic economics also play a role in gas prices. Supply and demand, for example, are always in flux, and gas prices rise and fall depending on how much gas is available and how much people want to buy.
Global oil prices also have a direct impact on the cost of fuel in Iceland, as does the currency exchange rate between the Icelandic króna and other currencies.
Gas Stations in Iceland: A Comparative Overview
When you’re driving around Iceland, you’ll see a few different gas station chains vying for your business. Here’s a quick rundown of the major players:
- N1: These are typically full-service stations, meaning an attendant will pump your gas for you. That convenience comes at a cost, though, as N1 stations tend to be pricier.
- Atlantsolia: Often self-service, Atlantsolia usually offers lower prices.
- Costco: If you’re a Costco member, filling up at their Reykjavik location is almost always the cheapest option.
- OB: You’ll generally find a lower price at this self-service option.
- Orkan: Like Atlantsolia and OB, Orkan is usually self-service and offers competitive prices.
- Olis: Similar to N1, Olis stations are generally full-service and command higher prices.
Keep in mind that gas prices can vary depending on the location. You’ll typically find that prices are higher in more remote areas due to the increased cost of transporting the fuel. Stations that are full-service tend to offer more amenities, like restaurants, shops, and car washes, but you’ll pay a premium for the added convenience.
To find the cheapest gas, your best bet is usually Costco, especially if you’re near Reykjavik. Otherwise, check the prices at self-service stations like Orkan and Atlantsolia to find the best deal.
Planning Your Fuel Budget: Factors Affecting Consumption
Gas prices in Iceland are just one piece of the puzzle. To really get a handle on your fuel budget, you need to think about how much gas you’ll actually use. Here are some things to consider:
Vehicle Type and Fuel Efficiency
What kind of car are you renting? A fuel-efficient compact car will obviously cost less to operate than a gas-guzzling SUV. Before you book, compare the fuel consumption rates of different vehicles. If available, think about renting a hybrid or even an electric vehicle. That could seriously cut down on your fuel costs.
Driving Habits and Road Conditions
How you drive matters. If you’re constantly slamming on the accelerator and brakes, or speeding down the highway, you’re going to burn through gas faster. Also, remember that Iceland has plenty of gravel roads. Driving on gravel increases friction, which means you’ll use more fuel than you would on a paved surface.
Route Planning and Distance
Plan your routes carefully. Try to avoid backtracking and look for the shortest possible routes between destinations. The more efficiently you plan, the less you’ll drive – and the less you’ll spend on gas. Once you know your planned distance, you can estimate your fuel needs based on your vehicle’s fuel efficiency rating.
Season of Travel
Winter driving in Iceland can be more costly than summer. The road conditions are often worse, and you might need to use 4-wheel drive more often, which burns more fuel. Summer is often cheaper because the weather is milder and the roads are generally in better condition.
Tips for Saving Money on Gas in Iceland
Gas prices in Iceland can be a shock, but there are ways to ease the pain at the pump. Here are a few strategies for keeping your fuel costs down.
Fuel-Efficient Driving Techniques
Driving efficiently can save you a surprising amount of money over the course of your trip. Try these tips:
- Drive at a steady speed. Avoid accelerating and braking too quickly.
- When you’re on the highway, use cruise control to maintain a consistent speed.
- Minimize idling and avoid using the engine when you don’t need to.
Gas Station Discounts and Loyalty Programs
Keep an eye out for discounts and specials offered by rental agencies and gas stations. Some rental companies partner with gas stations to offer discounted fuel prices.
If you’re a Costco member, you may be able to take advantage of lower gas prices at Costco locations in Iceland.
Monitoring Real-Time Fuel Prices
Apps like GSMbensin can help you track current gas prices at various stations around the island. Check the app before you fill up to see if you can find a better deal nearby.
Strategic Refueling
Gas prices tend to be lower in Reykjavik and other larger towns, so try to refuel when you’re in those areas. Don’t wait until you’re running on fumes, especially in remote areas, where gas stations can be few and far between.
Payment Methods and Practical Considerations
Okay, so you’re ready to fill ‘er up. Here’s what you should know about paying for your petrol and other practical considerations.
Accepted Payment Methods
You can pay for gas in Iceland using a credit card, a prepaid gas card, or a mobile payment app. Be aware that many gas stations require a chip and PIN for credit card transactions. Also, check with your credit card company about international transaction fees, which can add to the overall cost.
Fuel Availability in Remote Areas
If you’re planning a trip to Iceland, you’re probably hoping to explore some of the island’s more remote areas. Be sure to plan ahead and fill up the tank before you head out, as gas stations can be few and far between in certain regions.
Understanding Fuel Types
In Iceland, “gasoline” is called “petrol,” and diesel is, well, diesel. Just be sure you know which fuel type your rental car requires before you start pumping!
In Closing
Planning ahead and doing your homework can make a huge difference in what you spend on gas in Iceland. By choosing the right vehicle, practicing fuel-efficient driving, taking advantage of available discounts, and keeping an eye on prices, you can keep your costs down.
Don’t let the price of gas keep you from exploring Iceland’s stunning landscapes. With a little preparation, you can enjoy an unforgettable road trip without emptying your bank account. So buckle up, fill ‘er up, and get ready for an adventure!