We consider the two-variable interlace polynomial introduced by Arratia, Bollob`as and Sorkin (2004). We develop two graph transformations which allow us to derive point-to-point reductions for the interlace polynomial. Exploiting these reductions we obtain new results concerning the computational complexity of evaluating the interlace polynomial at a fixed point. Regarding exact evaluation, we prove that the interlace polynomial is #P-hard to evaluate at every point of the plane, except at one line, where it is trivially polynomial time computable, and four lines and two points, where the complexity mostly is still open. This solves a problem posed by Arratia, Bollob`as and Sorkin (2004). In particular...