Intense earthquakes in Grímsey highly unusual. Volcanic eruption unlikely
December 1 1918 Iceland became a soverign nation, the Kindgom of Iceland. Iceland was thus recognized by Denmark as a fully independent nation, with its own national flag and coat of arms, but in a personal union with the Danish King who was also the head of state of Iceland.
While December 1 was celebrated as a national holiday during the interwar period December 1 1918 was not a day of celebrations. The reason was that the winter of 1918-19 was very tough: The winter of 1917-18 is known as "The Winter of Great Frosts", as the temperature in January 1918 had dropped to below -30°C (-22°F). Many fjords had frozen and sea ice closed shipping lanes. The winter of 1918-19 was not as bad, but the arrival of the Spanish Flu in Iceland in early October, an eruption in the volcano Katla on October 12-November 4 and heavy winter storms in November and December convinced the authorities it was a bad idea to organize public celebrations on December 1.
In the 1920s and 30s December 1 was celebrated in larger towns, and students at the University of Iceland observed the Sovereignty Day. When Iceland was declared a Republic in 1944 December 1 was recognized as one of the offical flag days of the republic.
The Kingdom of Iceland
The establishment of the Kingdom of Iceland was based on the Danish-Icelandic Act of Union, an agreement between Iceland and Denmark. In addition to sharing a head of state Denmark represented Iceland in foreign affairs and national defence. The agreement was one of the most important steps toward the declaration of full independence which took place on June 17 1944.
Iceland had been granted home rule from Denmark on February 1 1904, when Hannes Hafstein became the first Prime Minister of Iceland. Icelanders continued to push for greater independence from Denmark. The decision by Denmark to grant Iceland sovereignty must be seen in the context of the birth of new nation states in the aftermath of WWI.
A personal union with Denmark
The period of home rule from 1904-1918 had also been a period of extremely rapid development and economic growth which had proven both to Icelanders and Danes that Icelanders were more than capable of taking their fate into their own hands.
However, few Icelanders believed Iceland should seek full independence as most believed Iceland was too small and weak to survive as an independent republic. Iceland was therefore to continue to remain in a personal union with Denmark which would represent Iceland and Icelandic interests on the national stage.
The Republic of Iceland
According to the Icelandic-Danish Act of Union this arrangement would be up for revision in 1940, and could be revoked in 1943 if the two nations failed to reach a new agreement. When it came time to revise the agreement the world had been plunged into a new World War. Denmark and Iceland had both been occupied, but by opposing sides in the conflict, Denmark having been conquered by Nazi Germany and Iceland by Britain.
In 1944, while the war was still being waged, Iceland declared full independence without consulting the Danish king.
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