From baacb2e7769cb849790ee435e048672e7e771448 Mon Sep 17 00:00:00 2001
From: Dax Raad <d@ironbay.co>
Date: Sun, 5 Jul 2026 16:14:02 -0400
Subject: [PATCH] fix(core): tolerate invalid OTLP configuration

---
 packages/core/src/observability.ts            |  8 ++++-
 .../core/test/effect/observability.test.ts    | 36 +++++++++++++++++++
 2 files changed, 43 insertions(+), 1 deletion(-)

diff --git a/packages/core/src/observability.ts b/packages/core/src/observability.ts
index 22285974d8..e99d8919d2 100644
--- a/packages/core/src/observability.ts
+++ b/packages/core/src/observability.ts
@@ -8,6 +8,12 @@ import { OtlpSerialization } from "effect/unstable/observability"
 import { Logging } from "./observability/logging"
 import { Otlp } from "./observability/otlp"
 
+const local = Logger.layer(Logging.loggers(), { mergeWithExisting: false }).pipe(
+  Layer.provide(NodeFileSystem.layer),
+  Layer.orDie,
+  Layer.merge(Layer.succeed(References.MinimumLogLevel, Logging.minimumLogLevel())),
+)
+
 export const layer = Layer.unwrap(
   Effect.gen(function* () {
     const logs = Logger.layer([...Logging.loggers(), ...Otlp.loggers()], { mergeWithExisting: false }).pipe(
@@ -19,6 +25,6 @@ export const layer = Layer.unwrap(
     )
     return Layer.merge(logs, yield* Effect.promise(Otlp.tracingLayer))
   }),
-)
+).pipe(Layer.catchCause(() => local))
 
 export const node = LayerNode.make({ name: "observability", layer, deps: [] })
diff --git a/packages/core/test/effect/observability.test.ts b/packages/core/test/effect/observability.test.ts
index 4758563f28..c075986364 100644
--- a/packages/core/test/effect/observability.test.ts
+++ b/packages/core/test/effect/observability.test.ts
@@ -52,6 +52,42 @@ describe("resource", () => {
   })
 })
 
+test("falls back to local logging when OTLP initialization fails", async () => {
+  const dir = await fs.mkdtemp(path.join(os.tmpdir(), "opencode-observability-test-"))
+  await using _ = {
+    async [Symbol.asyncDispose]() {
+      await fs.rm(dir, { recursive: true, force: true })
+    },
+  }
+  const child = Bun.spawn(
+    [
+      process.execPath,
+      "--eval",
+      `
+        import { Effect } from "effect"
+        import { Observability } from "./src/observability.ts"
+        await Effect.void.pipe(Effect.provide(Observability.layer), Effect.scoped, Effect.runPromise)
+      `,
+    ],
+    {
+      cwd: path.join(import.meta.dir, "../.."),
+      env: {
+        ...process.env,
+        OTEL_EXPORTER_OTLP_ENDPOINT: "://invalid",
+        XDG_CACHE_HOME: path.join(dir, "cache"),
+        XDG_CONFIG_HOME: path.join(dir, "config"),
+        XDG_DATA_HOME: path.join(dir, "data"),
+        XDG_STATE_HOME: path.join(dir, "state"),
+      },
+      stdout: "ignore",
+      stderr: "pipe",
+    },
+  )
+  const [exitCode, stderr] = await Promise.all([child.exited, new Response(child.stderr).text()])
+
+  expect({ exitCode, stderr }).toEqual({ exitCode: 0, stderr: "" })
+})
+
 test("file logger appends concurrent runs with a run on every line", async () => {
   const dir = await fs.mkdtemp(path.join(os.tmpdir(), "opencode-log-test-"))
   await using _ = {