Delta COVID-19 strain still troubling 'world's most vaccinated country'

The surge in COVID-19 cases in Iceland - where nearly all the tiny country's population is vaccinated - holds lessons for countries like Australia, an infectious disease expert says.

Iceland has one of the highest vaccination rates in the world, with 96 per cent of women and 90 per cent of men aged 16 or older having had at least one dose of coronavirus vaccine.

A total of of 86 per cent of the country's 357,000 population has been inoculated.

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But after Iceland relaxed restrictions in June, cases of the Delta variant are now soaring, local media reports.

Sanjaya Senanayake, from the Australian National University Medical School in Canberra, told nine.com.au Australian health officials should be monitoring Iceland's developments.

"It is interesting and something we in Australia have to watch closely," Professor Senanayake said.

From having only two active COVID-19 cases a month ago, Iceland now has more than 1590, with about 20 requiring hospital treatment, local media reports.

Professor Senanayake said the Iceland experience suggested vaccination rates should reach at least 80 to 85 per cent before restrictions start to be lifted, and even then some may have to remain.

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"Less than 80 to 85 per cent vaccination could still pose a dangerous situation," he said.

"Even after we achieve the 80 per cent vaccination we may have to consider keeping measures such as mask wearing and QR codes, at least in the short term."

Prime Minister Scott Morrison has flagged a 70 per cent vaccination rate target for Australia to begin easing restrictions.

Professor Senanayake said recent the rise in Iceland cases could be from children aged 12 to 15 who have yet to be vaccinated.