What is the context of revelation for this āyah?

Imām Ibn al-Jawzī (d. 597/1201) summarized the scholars' opinions in his book "Zād al-Masīr" as follows:

1. It was revealed concerning those from the People of the Book who had embraced Islam but continued to observe certain practices, such as avoiding the Sabbath, camel meat, and other things that the People of the Book used to avoid. [Narrated by Abū Ṣāliḥ from Ibn ʿAbbās]
2. It was revealed concerning the People of the Book who had not yet believed in the Prophet Muḥammad (ﷺ), commanding them to enter Islam. [Ibn ʿAbbās, al-Ḍaḥḥāk]
3. It was revealed concerning the Muslims, commanding them to fully embrace all the laws and teachings of Islam. [Mujāhid, Qatādah]