[BUG] 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?

Title: Cowork blocked by "Usage credits required for 1M context" despite standard model and available usage

Summary:
Cowork throws "API Error: Usage credits required for 1M context" and blocks the session, even though claude.ai/settings/usage shows 100% usage available. Logging out and back in did not resolve it.

What I've already tried:

• Checked claude.ai/settings/usage — shows 100% usage available
• Logged out of Claude Desktop/Cowork and logged back in — error persists

Account/environment details:

• Plan: [add your plan, e.g. Pro/Max]
• Platform: [macOS/Windows/Linux/Web]
• Cowork version (if known): [add if visible in app]
• Date/time first observed: [add]

Additional notes:
This matches other reports of the same root cause (Cowork/Claude Code defaulting to a 1M-context model internally, often during context compaction, and blocking before model selection is applied). Related GitHub issues: #62063, #63761, #64398, #64970, #65283, #65514, #65756.

Requesting:

• A fix so standard-context sessions aren't gated behind 1M-context usage credits
• Confirmation that no usage credits were incorrectly consumed on my account due to this bug

What Should Happen?

Expected behavior:
Cowork should use the standard context window by default and run within my plan's included usage, without requiring 1M-context usage credits.

Actual behavior:
Session is fully blocked by the 1M-context billing check even though standard context/model is selected and plan usage shows availability.

Error Messages/Logs

Steps to Reproduce

Steps to reproduce:

1. Open Cowork with a standard model selected (not a 1M-context variant)
2. Work through a normal task
3. Error fires: "API Error: Usage credits required for 1M context · turn on usage credits at claude.ai/settings/usage, or use --model to switch to standard context"
4. Session is blocked

Claude Model

None

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

2.1.165

Platform

Anthropic API

Operating System

Ubuntu/Debian Linux

Terminal/Shell

Terminal.app (macOS)

Additional Information

_No response_