How to conventiently pass around global settings which can be modified

I often find myself writing code that takes a set of parameters, does some calculalation and then returns the result to another function, which also requires some of the parameters to do some other manipulation, and so on. I end up with a lot of functions where I have to pass around parameters, such as f(x, y, N, epsilon) which then calls g(y, N, epsilon) and so on. All the while I have to include the parameters N and epsilon in every function call and not lose track of them, which is quite tedious.

What I want is to prevent this endlessly passing around of parameters, while still being able to, within a single for loop, to change some of these parameters, e.g.

for epsilon in [1,2,3]:
    f(..., epsilon)

I usually have around 10 parameters to keep track of (these are physics problems) and do not know beforehand which I have to vary and which I can keep to a default.

The options I thought of are

1. Creating a global settings = {'epsilon': 1, 'N': 100} object, which is used by every function. However, I have always been told that putting stuff in the global namespace is bad. I am also afraid that this will not play nice with modifying the settings object within the for loop.
2. Passing around a settings object as a parameter in every function. This means that I can keep track of the object as it passed around, and makes it play nice with the for loop. However, it is still passing around, which seems stupid to me.

Is there another, third, option that I have not considered? Most of the solution I can find are for the case where your settings are only set once, as you start up the program, and are then unchanged.