diff --git a/.changeset/fix-transient-auth-scope-classification.md b/.changeset/fix-transient-auth-scope-classification.md
new file mode 100644
index 0000000000..f25da92d1e
--- /dev/null
+++ b/.changeset/fix-transient-auth-scope-classification.md
@@ -0,0 +1,7 @@
+---
+"@runfusion/fusion": patch
+---
+
+summary: Retry transient OAuth token-rotation errors so in-flight agent calls survive rotation without failing the task.
+category: fix
+dev: withRateLimitRetry now retries transient auth errors (authentication_error, invalid credentials, token_expired) on a separate ~5s flat-delay budget that does not consume rate-limit attempts. OAuth scope/permission failures are explicitly excluded (operator must re-authorize) so they surface immediately instead of retrying pointlessly.
diff --git a/packages/engine/src/__tests__/rate-limit-retry.test.ts b/packages/engine/src/__tests__/rate-limit-retry.test.ts
index 01f86ec81c..1de497f3e6 100644
--- a/packages/engine/src/__tests__/rate-limit-retry.test.ts
+++ b/packages/engine/src/__tests__/rate-limit-retry.test.ts
@@ -289,7 +289,6 @@ describe("withRateLimitRetry", () => {
       "Invalid authentication credentials",
       "token_expired",
       "token expired",
-      "OAuth token does not meet scope requirements",
     ];
 
     for (const msg of patterns) {
@@ -305,4 +304,46 @@ describe("withRateLimitRetry", () => {
       expect(fn).toHaveBeenCalledTimes(2);
     }
   });
+
+  it("does not retry OAuth scope errors even when wrapped in an authentication_error envelope", async () => {
+    const scopeErrors = [
+      "OAuth token does not meet scope requirements",
+      "insufficient_scope",
+      '{"type":"error","error":{"type":"authentication_error","message":"OAuth token does not meet scope requirements"}}',
+    ];
+
+    for (const msg of scopeErrors) {
+      const fn = vi.fn().mockRejectedValue(new Error(msg));
+      const onRetry = vi.fn();
+
+      await expect(withRateLimitRetry(fn, { onRetry })).rejects.toThrow(msg);
+
+      // Permanent scope failures must surface immediately — no retries.
+      expect(fn).toHaveBeenCalledTimes(1);
+      expect(onRetry).not.toHaveBeenCalled();
+    }
+  });
+
+  it("cancels transient-auth retry sleep when abort signal fires", async () => {
+    const authErr = new Error(
+      '401 {"type":"error","error":{"type":"authentication_error","message":"Invalid authentication credentials"}}',
+    );
+    const fn = vi.fn().mockRejectedValue(authErr);
+    const ac = new AbortController();
+
+    const promise = withRateLimitRetry(fn, {
+      maxRetries: 5,
+      signal: ac.signal,
+    });
+
+    // Let the first call fail and enter the auth-retry sleep (~5s).
+    await vi.advanceTimersByTimeAsync(10);
+
+    // Abort before the 5s auth delay elapses.
+    ac.abort(new Error("Task paused"));
+
+    await expect(promise).rejects.toThrow("Task paused");
+    // Only the initial call — the auth retry never fires.
+    expect(fn).toHaveBeenCalledTimes(1);
+  });
 });
diff --git a/packages/engine/src/rate-limit-retry.ts b/packages/engine/src/rate-limit-retry.ts
index 905112f3bd..56e9ac2268 100644
--- a/packages/engine/src/rate-limit-retry.ts
+++ b/packages/engine/src/rate-limit-retry.ts
@@ -24,6 +24,11 @@
 
 import { isUsageLimitError } from "./usage-limit-detector.js";
 
+/*
+FNXC:EngineAuthRetry 2026-07-05-06:07:
+A long-running agent session holds its OAuth access token in memory. Claude Max access tokens rotate mid-run (~8 h lifetime); the in-flight call fails with a 401 authentication_error even though the credentials file has already been refreshed, and the very next call succeeds. Retry these a few times so a token-boundary rotation does not surface as a spurious task-failure alert. This budget is separate from the rate-limit retry budget and must not consume rate-limit attempts.
+*/
+
 /**
  * Matches transient authentication failures caused by credential rotation —
  * e.g. a Claude Max OAuth access token expiring mid-run (~8 h lifetime). A
@@ -32,10 +37,20 @@ import { isUsageLimitError } from "./usage-limit-detector.js";
  * a couple of quick retries before propagating as a task failure.
  */
 const TRANSIENT_AUTH_ERROR_RE =
-  /"type":\s*"authentication_error"|invalid authentication credentials|token[_\s]?expired|oauth token does not meet scope/i;
+  /"type":\s*"authentication_error"|invalid authentication credentials|token[_\s]?expired/i;
+
+/*
+FNXC:EngineAuthRetry 2026-07-05-06:07:
+OAuth scope/permission-grant failures are NOT transient — the token is valid but lacks required grants, so the operator must re-authorize the connection. Retrying would repeat the failing call for ~10 s before surfacing the real (operator-actionable) error. This exclusion runs BEFORE the transient match because providers wrap scope errors inside a generic {"type":"authentication_error"} envelope that would otherwise match TRANSIENT_AUTH_ERROR_RE and retry pointlessly.
+*/
+const SCOPE_ERROR_RE =
+  /oauth token does not meet scope|insufficient[_\s-]?scope|invalid[_\s-]?scope/i;
 
 function isTransientAuthError(message: string | undefined): boolean {
-  return TRANSIENT_AUTH_ERROR_RE.test(message ?? "");
+  const msg = message ?? "";
+  // Permanent scope failures must surface immediately instead of retrying.
+  if (SCOPE_ERROR_RE.test(msg)) return false;
+  return TRANSIENT_AUTH_ERROR_RE.test(msg);
 }
 
 /** Transient-auth retry budget — separate from the rate-limit `maxRetries`. */
@@ -118,6 +133,10 @@ export async function withRateLimitRetry<T>(
 
       lastError = error;
 
+      /*
+      FNXC:EngineAuthRetry 2026-07-05-06:07:
+      Transient-auth retries use a separate, smaller budget (AUTH_MAX_RETRIES) at a flat ~5s delay, and decrement `attempt` so they never burn a rate-limit attempt. Credential rotation completes in seconds, so the rate-limit backoff curve (30s -> 2min) would only prolong the outage. An already-aborted signal short-circuits to throw the original auth error without sleeping, matching the rate-limit path.
+      */
       if (authError) {
         if (authRetries >= AUTH_MAX_RETRIES || signal?.aborted) {
           throw lastError;