A powerful 7.2-magnitude earthquake struck off Vanuatu Sunday, with "hazardous" tsunami waves possible along the coasts of the Pacific archipelago, seismologists said.

The quake hit at a depth of 35 kilometres (22 miles), some 81 kilometres north-northwest of the town of Port Olry on Espiritu Santo island in Vanuatu and 407 kilometres from the capital Port Vila, the United States Geological Survey said.

"There is a low likelihood of casualties and damage," the USGS added.

The Pacific Tsunami Warning Centre said "hazardous tsunami waves" from the earthquake were possible within 300 kilometres of the epicentre, along the coasts of Vanuatu.

Australian government agency Geoscience Australia senior seismologist Jonathan Bathgate said that while Port Olry residents were likely to have felt "very intense shaking", "the likelihood is relatively low in terms of serious damage".

He added that Port Vila residents would have "felt a shake but it probably wouldn't be damaging at that distance".

"Earthquakes such as this occur quite often in the area, so Vanuatu experiences these earthquakes of similar magnitudes probably fairly regularly," Bathgate told AFP.

Vanuatu is part of the "Ring of Fire", a zone of tectonic activity around the Pacific that is subject to frequent earthquakes and volcanic eruptions.