[BUG] Sonnet (default) - Usage credits required for 1M context

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?

Initiating a new clause session using standard sonnet model, gives me a

API Error: Usage credits required for 1M context · run /usage-credits to turn them on, or /model to switch to 
  standard context

While this issue is active, its _forcing_ me to use Opus to keep going, meaning we burn tokens faster as we should. :(

What Should Happen?

API error shouldn't occur if using the default Sonnet model, rather than 1M.

Error Messages/Logs

API Error: Usage credits required for 1M context · run /usage-credits to turn them on, or /model to switch to 
  standard context

Steps to Reproduce

1. Open a new terminal
2. /model
3. Select sonnet
4. write 'hi'
5. see the issue.

Claude Model

Sonnet (default)

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

2.1.185

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

Terminal.app (macOS)

Additional Information

Same issue on other terminals really.