Memory size exhausted when trying to run cron manually

On my Drupal 6 website, when I run manually cron, I get this error message.

Fatal error: Allowed memory size of 134217728 bytes exhausted (tried to allocate 4181580 bytes) in /dirname/includes/database.mysql-common.inc on line 34

Cron is set to automatically run every night; the last few days it wasn't running, so I tried it manually.

Where should I increase memory, in the settings.php file, in the php.ini file for PHP, or somewhere else? I'm using AWS RDS and EC2 instances.

I have this line in the settings.php file.

ini_set('memory_limit', '128M');