News from the British Icelandic Chamber of Commerce. 

A volcanic eruption started around 7:30 PM on 21 May 2011 in Grímsvötn underneath the Vatnajökull glacier in Iceland. Grímsvötn is a very active volcanic area and has erupted five times since 1983. The last eruption was in 2004. These eruptions have in the past not resulted in wide-ranging flight disturbances.

The plume reached 20 km in height and Keflavík airport has been closed, with no flights arriving or departing Iceland for the day.

However, there are no indicators yet that there will be more disruption to flights beyond local disturbances.

To follow, up to date informations about the eruption, see here

Kind regards from Iceland