First of all are you sure it is an oil? Also, you do not say how large it is or the thickness of the substrate.
Are your sure it is cotton? Did you do a burn test? (seriously - this is a way to determine fabric content.) If you don't know the technique, don't learn on this piece, but one can take a thread from the selvedge and watch the reaction to the flame from a match or lighter. Cotton has a different reaction to man-made fibers (such as polyester or rayon) and also silk. Have you done a condition report? There may be areas of paint in the "balled up" sections where the paint is already lifting from the substrate, or has been cracked.
"Balled up" raises an immediate red flag as the paint bond to the substrate can already be weakened or stressed. Stretching may exacerbate the problem. A light substrate that is wrinkled may tempt you to overstretch it to try and get out the wrinkles. This is definitely the time to NOT USE canvas pliers (which I feel should only be used to stretch unpainted canvas.) Also, a strainer stretcher (not adjustable) may also tempt you to overstretch. This is also time for a keyable bar.
I would strongly avoid any advice to dampen or spray the piece with anything. It could further weaken the bond of the paint.
The conservator I work with would most likely do a localized flattening using copper plates and very heavy lead weights, perhaps assisted by the use of a hot table - but that is a job for a professional.
Once again the mantra - we are framers not conservators, repeat.......