[BUG] API Error: Rate limit reached despite Claude Max subscription with only 5% session usage

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

Environment:

Claude Code v2.1.81
macOS
Authenticated via Claude Max subscription (OAuth)
Platform: Cursor (VS Code extension) + standalone terminal

What's Wrong?
Every request returns API Error: Rate limit reached despite:

Claude Max subscription active
Current session: only 5% used (resets in ~3hr 46min)
Weekly limit: only 1% used

Steps to Reproduce:

Open Claude Code in Cursor terminal or standalone terminal
Type any message (e.g. "are you live?")
Immediately get API Error: Rate limit reached

What I tried:

rm -rf ~/.claude/credentials.json and re-authenticated
claude auth login (got callback error: Redirect URI http://localhost:50852/callback is not supported by client)
Tried adding API key as workaround — same rate limit error
Multiple logout/login cycles

Key finding:
/status shows 5% session usage and 1% weekly usage. Usage is nowhere near the limit. This points to a subscription auth recognition issue server-side, not actual quota exhaustion.

<img width="1114" height="415" alt="Image" src="https://github.com/user-attachments/assets/28a0bb7d-066b-445a-854a-113c57903f93" />

What Should Happen?

I should be able to use CC no problem, I have token and subscription.

Error Messages/Logs

⎿  API Error: Rate limit reached

Steps to Reproduce

Steps to Reproduce:

Open Claude Code in terminal (was working normally)
Send any message — immediately get API Error: Rate limit reached
No configuration changes were made prior to this occurring

Note: Issue appeared suddenly with no triggering action. Claude Code was working normally in a prior session.

Claude Model

None

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

Claude Code v2.1.81

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

Terminal.app (macOS)

Additional Information

_No response_