diff --git a/agent/context_compressor.py b/agent/context_compressor.py
index bba049230c..22b3c4af3d 100644
--- a/agent/context_compressor.py
+++ b/agent/context_compressor.py
@@ -288,6 +288,23 @@ class ContextCompressor(ContextEngine):
     def name(self) -> str:
         return "compressor"
 
+    def _recompute_thresholds_and_budgets(self) -> None:
+        """Rebuild derived token thresholds after a context/model change."""
+        self.threshold_tokens = max(
+            int(self.context_length * self.threshold_percent),
+            MINIMUM_CONTEXT_LENGTH,
+        )
+        # Threshold must stay below context_length so compression can trigger
+        # before the provider rejects the request outright.
+        self.threshold_tokens = min(
+            self.threshold_tokens, int(self.context_length * 0.95)
+        )
+        target_tokens = int(self.threshold_tokens * self.summary_target_ratio)
+        self.tail_token_budget = target_tokens
+        self.max_summary_tokens = min(
+            int(self.context_length * 0.05), _SUMMARY_TOKENS_CEILING,
+        )
+
     def on_session_reset(self) -> None:
         """Reset all per-session state for /new or /reset."""
         super().on_session_reset()
@@ -314,16 +331,7 @@ class ContextCompressor(ContextEngine):
         self.provider = provider
         self.api_mode = api_mode
         self.context_length = context_length
-        self.threshold_tokens = max(
-            int(context_length * self.threshold_percent),
-            MINIMUM_CONTEXT_LENGTH,
-        )
-        # Clamp: threshold must stay below context_length so compression can
-        # actually trigger before the API rejects the request.  The 95% cap
-        # gives 5% headroom — enough to catch the threshold in time.
-        self.threshold_tokens = min(
-            self.threshold_tokens, int(context_length * 0.95)
-        )
+        self._recompute_thresholds_and_budgets()
 
     def __init__(
         self,
@@ -360,25 +368,9 @@ class ContextCompressor(ContextEngine):
         # the percentage would suggest a lower value.  This prevents premature
         # compression on large-context models at 50% while keeping the % sane
         # for models right at the minimum.
-        self.threshold_tokens = max(
-            int(self.context_length * threshold_percent),
-            MINIMUM_CONTEXT_LENGTH,
-        )
-        # Clamp: threshold must stay below context_length so compression can
-        # actually trigger before the API rejects the request.  The 95% cap
-        # gives 5% headroom — enough to catch the threshold in time.
-        self.threshold_tokens = min(
-            self.threshold_tokens, int(self.context_length * 0.95)
-        )
+        self._recompute_thresholds_and_budgets()
         self.compression_count = 0
 
-        # Derive token budgets: ratio is relative to the threshold, not total context
-        target_tokens = int(self.threshold_tokens * self.summary_target_ratio)
-        self.tail_token_budget = target_tokens
-        self.max_summary_tokens = min(
-            int(self.context_length * 0.05), _SUMMARY_TOKENS_CEILING,
-        )
-
         if not quiet_mode:
             logger.info(
                 "Context compressor initialized: model=%s context_length=%d "
diff --git a/tests/agent/test_context_compressor.py b/tests/agent/test_context_compressor.py
index fc544eab39..a9fa8e4239 100644
--- a/tests/agent/test_context_compressor.py
+++ b/tests/agent/test_context_compressor.py
@@ -998,7 +998,7 @@ class TestThresholdClampAtMinimumContext:
         assert c.should_compress(c.threshold_tokens) is True
 
     def test_update_model_threshold_below_context_length(self):
-        """update_model() must also clamp the threshold."""
+        """update_model() must also rebuild all derived budgets."""
         with patch(
             "agent.context_compressor.get_model_context_length",
             return_value=200_000,
@@ -1010,6 +1010,8 @@ class TestThresholdClampAtMinimumContext:
         )
         assert c.threshold_tokens < MINIMUM_CONTEXT_LENGTH
         assert c.threshold_tokens == int(MINIMUM_CONTEXT_LENGTH * 0.95)
+        assert c.tail_token_budget == int(c.threshold_tokens * c.summary_target_ratio)
+        assert c.max_summary_tokens == int(MINIMUM_CONTEXT_LENGTH * 0.05)
         assert c.should_compress(c.threshold_tokens - 1) is False
         assert c.should_compress(c.threshold_tokens) is True
 
@@ -1022,3 +1024,5 @@ class TestThresholdClampAtMinimumContext:
             c = ContextCompressor(model="test", quiet_mode=True)
         # 50% of 200K = 100K, 95% of 200K = 190K => min(100K, 190K) = 100K
         assert c.threshold_tokens == 100_000
+        assert c.tail_token_budget == int(100_000 * c.summary_target_ratio)
+        assert c.max_summary_tokens == 10_000