Iceland has declared a state of emergency with an ‘imminent’ threat of a major volcanic eruption.

It ‘could obliterate the entire town of Grindavik’ authorities say.

Rumblings began three weeks ago with thousands of earthquakes recorded since.

The Icelandic Meteorological Office believes there is a ‘considerable risk of an eruption based on the speed of the underground magma buildup.

Grindavik was evacuated on Saturday.

It is located about 50 kilometres from capital Reykjavik.

Authorities also upped the alert level for aviation to orange level, although flights are still operating and the airport is still fully functioning.

A major eruption of the Eyjafjallajökullin volcano in 2010 caused havoc with air travel, grounding more than 100,000 transatlantic and European flights.

However, there is no evidence to suggest this will be at the same level, a Met Office spokesperson said.

Still, volcanic activity could last for weeks, they said.