As a strategic point in the Atlantic campaign, Iceland was a must.
For shelter, refuelling, air ops etc. You can see on the Uboat.net that there are many sub wrecks around our island.
BTW, the British also occupied the Faroe Islands, - same purpose.
They were here on the morning of may 10th in 1940, - same date as the Germans rolled into the Netherlands.
We were really lucky that the Germans didn't beat them to it, - firstly the abovementioned resupply problem, secondly they had a reputation for being bad masters, and thirdly, - probably, - there would have been some fighting perhaps.
The Brits were rather welcomed, they didn't mess with internal affairs, and they payed for what they got, products, workforce etc.
It turned all out to be an economical BOOM, so the WW2 was actually mostly a very prosperous time.
The dark side was the sinking of fishing boats and merchant vessels under Icelandic flag, - even in 1945 the biggest passanger liner was torpedoed. German aircraft also occasionally appeared, bombed and strafed. Some crashed here or were shot down.
Then there was espionage, and double agents were also active!
Then to the cod wars. The moving of our fishing border was as follows, - 2-4 miles, 4 to 12, 12 to 50 ,and 50 to 200.
Every time we had to jostle with the English, quite a funny affair.
in 1973 it was 50 miles, and 1975-76 the 200 miles, - those were the toughest ones. The Brits sent frigates and tugboats, and there was a lot of bumbing into each others. The Icelanders had 6 patrol ships, like 1000 tons max, doing only 20 kts max.
The Brits sent frigates 3 times the size, with 36 kts, but less nimble, and very much more lightly built, - our patrol ships are built for sailing in driftice, so thick skinned.
The Icelandic tactic employed a secret weapon, hehe, a towed cutter unit used to snap the trawler's pulling wires, sending their entire expensive fishing gear to the bottom of the ocean.
So, there were dogfights when the British frigates and tugboats tried to block, and ships would on frequent occasions smash into each other.
There was one attempt for sinking, - a British frigate caught an Icelander by some 90 deg angle, and he tumbled to 70 deg listing. But he tumbled out of the attack and in his new position managed to cut a trawler net within a minute.
The same Icelandic captain used cannon, that was in 1976. He had ordered a British trawler to stop, but he steamed ahead. There was a warning shot, then he ordered the Brit to evacuate crew from the front quarters, which he promptly did. Then cannon shells were pumped into the front of the Trawler. there was ceize-fire so the Brit could explore the damage, then repeated a few times. The Brit never yealded, but had to return to docks instead.
Quite amazing stuff, I´ll see if I can find any links.
At that moment actually, political connection between the UK and Iceland was cut, and ambassadors called home!
Anyway, they gave up, and now everybody has their 200 miles, including the UK.