Fuel prices in Iceland are pretty extortionate, to say the least. Most people are surprised when they arrive and fail to prepare for fuel costs. If you're driving the ring road, there's every chance you may end up spending more on fuel than the actual car rental. 

There are many fuel stations over the island, and various companies such as N1, ÓB and Orkan. But currently, the cheapest gas station in Iceland is *drum roll please* COSTCO!

When Costco first opened, their fuel was listed at 169.9 per litre. At that time, the closest competitor was 185.7 per litre. Pretty incredible! And whilst the price has risen now due to fuel prices inflating, it is still by far the cheapest in Iceland. The main issue is that Costco requires a membership for purchasing gas, so most tourists will avoid it.

But don't threat! There are still some other great options within Reykjavík such as Spöngin over in Grafarvogur which regularly has fair prices and also Skemmuvegur. 

When returning your rental vehicle, you will be required to return it with a full tank. There is a gas station at the car rental area of the airport called 'Orkan', this would be the best location for you to fill up as if you fill up further away you may use too much gas and the agency may charge you for this.  

Below I will list some of the cheapest fill-up locations in Reykjavik and on the ring road:

Reykjavik

• Skemmuvegur (Orkan)
• Spöngin (Orkan)
• Smáralind (Dælan)
• Hornafjörður (Olís)

South-west region

• Grindavík (Orkan)
• Keflavíkurflugvöllur (Orkan)

South 

• Hveragerði (Orkan)
• Selfoss (Orkan)
• Vík (Orkan)

East

• Egilsstaðir (Orkan)
• Eskifjörður (Orkan)

North

• Akureyri, Kjarangata (Orkan)
• Mývatn (Orkan)

Westfjords 

• Bíldudalur (Orkan)
• Ísafjörður (Orkan)

West 

• Akranes (Orkan)
• Borgarnes (Atlantsolía)
• Grundarfjörður (Orkan)

If you intend on driving the ring road or heading into the West Fjords then I would recommend filling up whenever you get chance! Over in the East of Iceland and the West Fjords, gas stations are few and far between! 

You can pay by card at most gas stations, with no requirement to head into the building to pay. It's very convenient for when you are in a rush! 

If you check out this website, you can see the current prices for some of the main gas stations in Iceland. It will give you a quick glimpse of what you may expect to pay whilst here! You can also check out Global Petrol Prices for the average fuel costs in Iceland.